Preamble

The House met at a Quarter before Three of the Clock, Mr. SPEAKER in the Chair.

PRIVATE BUSINESS.

PRIVATE BILLS [Lords] (Standing Orders not previously inquired into complied with).

Mr. SPEAKER laid upon the Table Report from one of the Examiners of Petitions for Private Bills, That, in the case of the following Bills, originating in the Lords, and referred on the First Reading thereof, the Standing Orders not previously inquired into, and which are applicable thereto, have been complied with, namely:

Barnet District Gas and Water Bill [Lords].

London County Council (General Powers) Bill [Lords].

Stoke - on - Trent Corporation Bill [Lords].

Bills to be read a Second time.

Bristol Corporation Bill,

As amended, to be considered Tomorrow.

Southend - on - Sea Corporation Bill [Lords] (by Order),

Second Reading deferred till Friday.

Oral Answers to Questions — TRADE AND COMMERCE.

FILM INDUSTRY.

Sir FRANK MEYER: 1.
asked the President of the Board of Trade whether he has made any decision as to the steps to be taken to assist the British film-producing industry?

The PRESIDENT of the BOARD of TRADE (Sir Philip Cunliffe-Lister): No, Sir. I am still awaiting a report from the cinema industry.

Sir F. MEYER: Will the right hon. Gentleman be ready to take steps when this much delayed report is presented?

Sir P. CUNLIFFE-LISTER: I am very anxious to get this report, and I shall be glad if my hon. Friend will tell me how to accelerate it.

AUSTRALIA AND NEW ZEALAND (BRITISH IMPORTS).

Mr. A. V. ALEXANDER: 10 and 11.
asked the President of the Board of Trade(1) the percentage of the import trade of New Zealand done by this country during the years ending 31st December, 1923, 1924, and 1925, and for the six months ending 30th June, 1926;
(2) the percentage of the import trade of Australia clone by this country during the years ending 31st December, 1923, 1924 and 1925, and for the six months ending 30th June, 1926?

Sir P. CUNLIFFE - LISTER: The answers to these questions consist of tables of figures, and the hon. Member will, perhaps, agree to my circulating them in the OFFICIAL REPORT.

Following is the answer:

I.

The following statement shows the aggregate values of the imports into the Commonwealth of Australia during each of the years 1923 and 1924, and during the first nine months of 1925, together with the values of the imports recorded as of United Kingdom origin in each period, and their proportions to the respective totals. Similar information for later periods has not yet been received:

Year.
Total Imports.
Imports of United Kingdom origin.*



£
£
Per cent.


1923
136,202,322
166,198,080
48.6


1924
145,269,851
66,794,322
46.0


1925 (Jan.-Sept.).
116,700,145
48,287,497
41.4


* Including Imports of Irish Free State origin prior to 1st July, 1924.

II.

The following statement shows the aggregate values of the imports into the Dominion of New Zealand during each of the years 1923 and 1924 and 1925, and during the first three months of 1926, together with the values of the imports recorded as of United Kingdom origin in each period, and their proportions to the respective totals. Similar information for later periods has not yet been received:

Year.
Total Imports.
Imports of United Kingdom origin.



£
£
Per cent.


1923
43,378,493
22,532,205*
51.9*


1924
48,527,603
23,203,825
47.8


1925
52,456,407
25,535,332
48.7


1926 (Jan.-March).
13,692,772
6,599,868
48.2


* Including Imports of Irish Free State origin.

Oral Answers to Questions — MERCANTILE MARINE.

INTERNATIONAL LABOUR CONFERENCE.

Sir HARRY BRITTAIN: 2.
asked the President of the Board of Trade whether any Report has been received from the Government delegates to the International Maritime Conference at Geneva; and what were the number of conventions and recommendations adopted?

The PARLIAMENTARY SECRETARY to the MINISTRY of LABOUR (Mr. Betterton): The ninth Session of the international Labour Conference adopted the following draft conventions and recommendations: Draft convention concerning Seamen's Articles of Agreement, draft convention concerning Repatriation, recommendation concerning the Repatriation of Masters and Apprentices, and recommendation concerning the general principles for the inspection of the conditions of work of seamen. As in previous years the Report of the Government delegates will be presented to Parliament in due course.

Sir H, BRITTAIN: Is it not a considerable compliment to this country that, for the third time, an Englishman has been appointed Chairman of this International Labour Conference.

Mr. BETTERTON: Yes, Sir, I think that is so.

ARAB CREWS, BIRKENHEAD.

Mr. HAYES: 6.
asked the President of the Board of Trade whether he is aware that the steamship "Queen Maud," of Glasgow, and the steamship "Briar Park," of Greenock, signed on Arab crews at the port of Birkenhead on the 22nd and 23rd instant, respectively; that these Arab seamen were brought to Birkenhead from Manchester and South Shields; whether these Arabs, whose address is given in the ships' articles as 10, Chaper Road, South Shields, claimed British nationality; whether the Board of Trade officers satisfied themselves that these Arabs are not subject to the Aliens Restriction (Amendment) Act, 1919, Section 5 (2), and the Special Restrictions (Alien Coloured Seamen) Order, which applies to all British ports as from the beginning of this year; and whether he will consider the appointment of a committee to inquire into and report upon the existing arrangements for engaging crews for ships signing articles in British ports?

Sir P. CUNLIFFE-LISTER: Fifteen Arab seamen out of a crew of 40 were engaged on the "Queen Maud," and seven Arab seamen out of a crew of 25 were engaged on the "Briar Park." The men for the "Queen Maud" came from South Shields to Liverpool for engagement; it is not known from what port the men for the "Briar Park" came, but six of the seven gave Cardiff addresses. All the men produced police registration certificates, and all were engaged at the standard rate of wages laid down by the National Maritime Board. The statutory requirements were fully complied with in every case. This question is being carefully watched, and the existing requirements, which are quite clear, are being steadily enforced. I do not think there is sufficient reason for the, appointment of a committee such as the hon. Member suggests.

Mr. HAYES: May I ask whether the right hon. Gentleman has been informed of the intense feeling that was created in the port while these Arab seamen were being released from the forecastle and were being signed on; whether it is not the case that the Conservative party's pledge during the Election, "British seamen for British ships," is not being carried out; and how soon the right hon. Gentleman proposes to give effect to it?

Sir P. CUNLIFFE-LISTER: On the contrary, so far from that being the case, the special Home Office Order with regard to coloured seamen is being carried out.

Mr. HAYES: Is the right hon. Gentleman aware that that special Order has not served its purpose of preventing the importation of Arab seamen on the Merseyside while there are 5,500 British seamen who are unemployed, and what steps does the right hon. Gentleman propose to take in that regard?

Sir P. CUNLIFFE-LISTER: What the Order was designed to do, and what it has done effectively, is to keep fresh entrants from coming into this country.

Commander WILLIAMS: Does not my right hon. Friend think it is really time to tighten up these Regulations very considerably?

Sir P. CUNLIFFE-LISTER: It is not quite so simple as that, because the great majority of these men are British subjects, and all of them have a British domicile.

Mr. HAYES: May I ask whether they have not got their citizenship merely by the adoption of addresses within British territory, and whether it is the case that the language test is not always applied before they sign on?

Sir P. CUNLIFFE-LISTER: The language test is applied, and, with regard to the first part of the hon. Member's question, that is exactly what the Home Office Order prevents, because it compels every alien to register. If he does not register, he is liable to prosecution, and he is prosecuted.

Mr. HAYES: May I be allowed to press this point? Although the address given was "10, Chaper Road, South Shields," obviously these Arab seamen are not natives of Great Britain.

Sir P. CUNLIFFE-LISTER: I did not say that they were originally natives of Great Britain, but the difficulty is that you are dealing with a number of men who are either British citizens or have, under British law, a British domicile. The real point, and the point upon which we are concentrating our attention, is stopping further aliens from coming into this country.

Oral Answers to Questions — RUSSIA.

BRITISH TRADE.

Mr. PURCELL: 8.
asked the President of the Board of Trade whether he is aware that the Russo-British Chamber of Commerce, in a recently issued memorandum, declared that the turnover of British-Russian trade had increased from £2,809,541, in 1920, to £58,079,673, in 1925; whether he is aware that Russia is the one country in the world with which no British exporter has contracted a single bad debt since 1920; and whether, under these circumstances, he can now see his way to instruct the Advisory Committee, set up under the Trade Facilities Acts, to consider applications for the benefits of these Acts from British firms desirous of trading with Russia?

Mr. A. M. SAMUEL (Secretary, Overseas Trade Department): I have not seen the document referred to by the hon. Member. As regards the second part of the question, I have received no complaint that Soviet Russia has failed to meet her trading obligations. With regard to the last part of the question, I would refer the hon. Member to the reply given to the hon. Member for the Forest of Dean (Mr. Purcell) yesterday.

Lieut. - Commander KENWORTHY: Will the hon. Gentleman have the answer to the second part of the question sent to the Chancellor of the Exchequer, in view of his recent speech?

Mr. SAMUEL: No, Sir. I do not agree with the figures given by the hon. Member for the Forest of Dean (Mr. Purcell) in the second part of his question.

Lieut. - Commander KENWORTHY: I mean the part with regard to the bad debts.

Mr. SAMUEL: There is nothing very much in that point.

Mr. PURCELL: Will the hon. Gentleman permit me to say that these are not my figures, but the figures of the Anglo Russian Chamber of Commerce?

TRADE DELEGATION (INCOME TAX).

Mr. ALBERY: 50.
asked the Chancellor of the Exchequer whether profits made by the Russian Trade Delegation in this country are assessed to Income Tax?

The CHANCELLOR of the EXCHEQUER (Mr. Churchill): The Commissioners of Inland Revenue are precluded from disclosing information as to the Income Tax paid by any individual person or company, but my hon. Friend may rest assured that the organisation to which he refers is being treated in conformity with the a

Mr. PALING: Does that mean that the Government have no objection to taking Russian money got in this way?

Mr. CHURCHILL: We shall take everything which comes within the ambit of the law from Russia or anywhere else.

Mr. A. V. ALEXANDER: Surely as this organisation is registered under the British Company Law, it must therefore conform to it?

Mr. CHURCHILL: I have no doubt that is so. Whatever is the law is being carried out, but I am not prepared to say what is the law.

ANGLO-GERMAN INVESTMENT AND TRUST COMPANY.

Mr. T. WILLIAMS (for Mr. TAYLOR): 7.
asked the President of the Board of Trade whether his attention has been drawn to the recent formation in London of an Anglo-German Finance Company, with a capital of £1,000,000, to be used for the purpose of lending money to German industrial concerns; and whether he proposes to introduce legislation to prevent the use of British capital for the development of competitive foreign industries?

Sir P. CUNLIFFE-LISTER: I am aware of the formation of a company such as that referred to, for the purpose of carrying on the business of an investment and trust company. The answer to the second part of the question is in the negative.

Mr. PALING: If British miners are asked to work eight hours a day to compete with foreign competition, is it fair that British capitalists should be allowed to make a profit out of foreign industry?

Mr. T. WILLIAMS: Is the right hon. Gentleman aware that this money financing German firms is to enable Germany to trade with Russia. Does he not think that same trade could very well be helping our own unemployed?

Sir P. CUNLIFFE-LISTER: I am not aware where the trade is going to be done, but I quite agree that the Russian Government could place a great many more orders than they do and pay for them.

GERMAN CREDITS.

Mr. T. WILLIAMS (for Mr. TAYLOR): 9.
asked the President of the Board of Trade whether his attention has been drawn to the conclusion of an agreement between the Russian Government and a group of German banks for the granting of credits by these banks to German firms wishing to do business with Russia, the interest on all credits granted being payable by Russia; and whether, in view of this circumstance, His Majesty's Government will reconsider their refusal to extend the Trade Facilities Act and exports credits scheme to Anglo-Russian trade?

Mr. SAMUEL: I may refer the hon. Member to the reply on the same subject which I gave yesterday to the hon. Member for the Forest of Dean.

MILITARY KNIGHTS OF WINDSOR.

Sir MALCOLM MACNAGHTEN: 13.
asked the Secretary of State for War whether officers who are members of the Church of Ireland are eligible for appointment as Military Knights of Windsor; and whether, if they are eligible, he will take steps to procure an Amendment of the King's Regulations for the Army which at present appear to restrict such appointments to members of the Church of England?

The SECRETARY of STATE for WAR (Sir Laming Worthington-Evans): The answer to the first part of the question is in the affirmative. As regards the second part of the question, since, as I am informed, the Church of England and the Church of Ireland are in communion, I see no reason for amending the Regulations as suggested.

Sir M. MACNAGHTEN: Is it the opinion of the War Office that members of the Church of Ireland are members of the Church of England?

HON. MEMBERS: Of course, they are!

Sir L. WORTHINGTON-EVANS: I am not quite sure that the opinion of the War Office would be of any value in that matter.

Oral Answers to Questions —  SCOTLAND.

MOTOR TRAFFIC, UDDINGSTON.

Mr. SULLIVAN: 19.
asked the Secretary for Scotland how many times the police set traps on the road to catch omnibus drivers on the Hamilton and Glasgow side of Uddingston, and the amount of money paid by the drivers in fines during the month of June?

The SECRETARY for SCOTLAND (Sir John Gilmour): I am not in a position to give the hon. Member the information asked for in the first part of his question. The fines imposed on omnibus drivers during the month of June, for the offence of exceeding the speed limit on the roads between Uddingston Cross and Hamilton and between Uddingston Cross and Glasgow, in the Lanarkshire Police District amounted to £61. Proceedings in other Lanarkshire cases are pending. In Glasgow, during the month of June, there were seven convictions in respect of similar offences committed in April by drivers of omnibuses on routes passing Uddingston, but I have not information at present as to the total amount of fines imposed in these cases. Proceedings are pending in respect of other offences committed in Glasgow during June.

Mr. SULLIVAN: Cannot the policemen find some other work to do, instead of being continually engaged in setting traps to catch people who are trying to earn a livelihood in this way?

Sir J. GILMOUR: I must demur to the expression "traps." The duty of the police is to supervise the traffic on the roads generally.

CENSUS OF AGRICULTURAL, PRODUCTION.

Mr. MacKENZIE LIVINGSTONE: 21.
asked the Secretary for Scotland when the Census of Agricultural Production, in regard to which an inquiry was made by the Board of Agriculture in 1925, will be published?

Sir J. GILMOUR: The Board of Agriculture's inquiries were made on behalf of the Board of Trade as the Department
responsible for the Census of Production, and the Returns obtained are in process of tabulation. That work is now practically completed, but it is not yet possible to indicate a date when the Report will be ready for publication.

SMALL HOLDINGS.

Mr. LIVINGSTONE: 22.
asked the Secretary for Scotland whether he is aware that the number of small holdings existing in Scotland is practically the same now as in 1912, although the Board of Agriculture reports that, 2,902 new holdings have been formed during the 14 years since 1912; and whether he will give an explanation of this fact?

Sir J. GILMOUR: The reply to the first part of the question is in the affirmative. The explanation desired by the hon. Member is that the creation of new holdings is offset by the discontinuance of existing holdings largely owing to merger in other holdings.

Mr. LIVINGSTONE: 23.
asked the Secretary for Scotland, in view of the statements in the Fourteenth Report of the Board of Agriculture that the most suitable and best qualified of the ex-service applicants have been provided for, that only 83 ex-service applicants were reported on unfavourably, and that the strict preference accorded to ex-service men during recent years should be relaxed, if he will state what steps the Government intends to take to secure holdings for the 3,803 ex-service men whose applications are shown as still outstanding?

Sir J. GILMOUR: The number of outstanding applications from ex-service men includes a large proportion which cannot be dealt with at present because the applicants do not possess the necessary capital or experience to enable them to undertake the obligations incumbent on smallholders or because they have applied for land which is not available for land settlement purposes. The constitution of small holdings in Scotland is proceeding, as far as the funds at my disposal permit and where land suitable for the purpose is available. In selecting men for settlement preference will he given, other things being equal, to suitable ex-service applicants

Mr. SKELTON: What is the amount available during the current year?

Sir J. GILMOUR: I must have notice of that question.

Mr. RILEY: Is it not the case that there are a number of outstanding applications for small holdings from men who are not ex-service men?

Sir J. GILMOUR: We have a number of applications from men who are not ex-service men, but I could not give the number without notice.

Major Sir ARCHIBALD SINCLAIR: 18.
asked the Secretary for Scotland whether his attention has been drawn to Section 10 of the Government White Paper on Agricultural Policy; and whether it is his intention to introduce legislation with the object of providing that the bona fide farm servant will be assisted to acquire as his own property a cottage and a small area of land which he can cultivate in addition to his earnings?

Sir J. GILMOUR: The reply to the first part of the question is in the affirmative. The general statement in the paragraph respecting the development of small holdings on sound lines applies to Scotland as well as to England and Wales. I propose to pursue this policy under the powers which already exist. The concluding sentences in the paragraph on the subject of proposed legislation empowering county councils to continue and extend the provision of small holdings and cottage holdings, and in particular to make provision for the purpose mentioned in the question, relates to the methods and conditions applicable in England and Wales. As at present advised, I do not think that any sufficient purpose would be served by conferring powers for this purpose on county councils in Scotland.

ROSYTH NAVAL AND MILITARY HOSTELS.

Mr. J. B. COUPER: asked the hon. and gallant Member for Tonbridge, as representing the Charity Commissioners, whether he is aware that £16,000 was subscribed in Scotland in 1917 for the construction of naval and military hostels by the Salvation Army in Rosyth, and that this sum is in the hands of the Charity Commission, together with £4,000 received as profits of then existing hostels; and whether in view of the reduction of the dockyard at Rosyth to a care and maintenance basis, he can
state if it is proposed to proceed with the construction of similar buildings in another part of Scotland?

Lieut.-Colonel SPENDER-CLAY (for The Charity Commissioners): The fund in question is now represented by stocks held by the Official Trustees of Charitable Funds, and is governed by a scheme established by the Charity Commissioners on the 19th September, 1919, directing the appropriation of the fund to the erection on a site at Rosyth already purchased of a home and hostel in connection with the Salvation Army for members of His Majesty's Naval, Military or Air Forces. The doubt regarding the final use of Rosyth postponed, and the final decision to reduce Rosyth rendered impracticable the realisation of the scheme, and the trustee of the charity has endeavoured, but without success, to find an alternative place in Scotland from which country the bulk of the subscriptions to the fund were derived where such a hostel would be useful.
It has been proposed that the charity should be transferred to Devonport, where the conditions are similar to those at Rosyth when it was a naval base, but in view of the object for which the fund was raised and the terms of their scheme, the Charity Commissioners are unable to sanction the transfer until the consent of the subscribers has been obtained.
A letter has accordingly been drafted, a copy of which will, it is understood, be sent shortly to every subscriber to the fund, explaining the position and asking whether he is content that his subscription should be applied to a hostel for soldiers, sailors and airmen at Devonport, or whether in the circumstances he claims that his subscription should be returned to him.

Mr. COUPER: As the money was almost exclusively provided from Scottish sources, and as many of the subscribers have either died or are not available, will the hon. and gallant Member undertake, in cases where it is impossible to get into communication with them, that their subscriptions shall be earmarked for expenditure in Scotland on a similar scheme in connection with either the Army or the Navy?

Lieut.-Colonel SPENDER-CLAY: I think it will be necessary to await the result of the letter which has been sent out to find out what subscribers wish done with it. If they do not say, the money might be allotted to some similar scheme in Glasgow or other parts of Scotland.

Mr. HORE-BELISHA: Will the hon. and gallant Member bear in mind that this fund was destined for the use of the Navy and that the very same men who would have benefited at Rosyth will now benefit under it at Devonport?

Lieut.-Colonel SPENDER-CLAY: Yes, Sir, and the Commissioners desire to keep the fund as nearly as possible for the object for which it was subscribed.

Mr. N. MACLEAN: Will the hon. and gallant Gentleman tell the House, when he receives the reply, what the decision of the Charity Commissioners is to be, before they proceed with any undertaking?

Lieut.-Colonel SPENDER-CLAY: If the hon. Member will put down a question, I will let him know.

Sir H. BRITTAIN: Is not this a unique instance of a sum of money being diverted from Scotland to be spent in England?

DEER FORESTS (CATTLE GRAZING).

Sir A. SINCLAIR: 20.
asked the Secretary for Scotland how many cattle and sheep, respectively, were grazed in each of the last three years in deer forests in Scotland?

Sir J. GILMOUR: According to inquiries made by the Board of Agriculture for Scotland the approximate numbers of cattle grazed on deer forests in Scotland in the three years 1923, 1924 and 1925 were 1,445, 684 and 1,162 respectively, while the corresponding numbers of sheep were 33,187, 24,271 and 51,058 respectively. The hon. and gallant Baronet is no doubt aware that compulsory powers for obtaining returns of stock on deer forests did not exist until this year, and the figures ascertained in previous years may therefore not be entirely reliable.

Oral Answers to Questions — COAL TRADE DISPUTE.

RETAIL PRICES, DUNDEE.

Mr. JOHNSTON: 24.
asked the Secretary for Mines whether he is aware that foreign coal is being discharged at Dundee; whether he is aware that this coal is being purchased abroad at 30s. a ton and is being sold in Dundee at 3s. 6d. per cwt. or £3 10s. a ton; and what steps he is prepared to take to lessen retail prices in Dundee?

The SECRETARY for MINES (Colonel Lane Fox): I understand that foreign coal is being delivered in Dundee at 3s. 6d. per cwt., but I do not know the price at which it was purchased. I do not think that there is any action I could usefully take in respect of prices of foreign coal.

Mr. JOHNSTON: Is it really outside the power of the right hon. Gentleman to take steps to stop this grave scandal; and is he aware that the result of his intervention already, in compelling these people to reduce their price by 6d. per cwt., has had a splendid effect, and could he not go a step further and stop this profiteering?

Colonel LANE FOX: The hon. Member's question refers to foreign coal, and it would be very undesirable at this time to attempt to stop foreign coal coming into this country. As regards home coal, that, of course, is different, and I am looking into that matter.

Lieut. - Commander KENWORTHY: With regard to the purpose for which the Government are about to ask for £3,000,000, will that coal be sent out to the consumer at cost, plus the necessary expenses?

Mr. JOHNSTON: It is with reference to foreign coal that I ask the right hon. Gentleman to take steps to see whether or not it is the case, as is openly alleged, that these people are able to buy this coal, received in Dundee, at 30s., and sell it at £3 10s.

Colonel LANE FOX: I do not think the hon. Member's figures are correct, but it is extremely difficult to say what the price is, there are so many different varieties of coal at different prices coming into the country. In any case, it would be very undesirable to take any steps
which at this particular moment, when coal is so badly needed, would prevent supplies of foreign coal from coming in.

Mr. MACLEAN: Can the right hon. Gentleman not assure the people outside that even in the circumstances in which the country is placed to-day, the coal that, is coming from abroad will not be used by coal merchants in order to profiteer? That is the question; why does not the right hon. Gentleman answer?

Colonel LANE FOX: I do not think that is exactly what the hon. Member for Dundee (Mr. Johnston) asked. In any case I am not prepared to discourage the flow of foreign coal into this country.

Commander WILLIAMS: Could not this question be very simply remedied by a resumption of work?

Mr. MACLEAN: Will the hon. and gallant Member himself take a job in some mine and dig some coal?

Mr. RENNIE SMITH: In view of the allegation that coal is being brought from abroad to this country at 30s. and is being sold at a much higher price, not only in Dundee but in Yorkshire, will not the right hon. Gentleman make inquiry into this matter and see what is the actual position?

Colonel LANE FOX: I am making full inquiry but, as I have said, the prices vary considerably and what may be true in one place may not be true in another. You cannot place any definite price under such varying conditions.

Mr. KIRKWOOD: Does that mean that supplies of coal coming in from abroad at. 30s. are to be sold at £3 10s., and that the right hon. Gentleman is not prepared to stop it? I put a question to him a month ago—[HON. MEMBERS: "Speech!"]—and he said then he would take every step to stop profiteering.

HON. MEMBERS: Order!

MINERS' EMPLOYMENT.

Lieut.-Commander KENWORTHY: 25.
asked the Secretary for Mines how many miners were at work in the coal mines, other than safety men, on 30th June last; and how many miners were not at work on the same date?

Colonel LANE FOX: The number of wage earners on colliery books imme-
diately before the stoppage was 1,106,200. At the end of June about 11,300 men were at work in pits which were, winding coal. I do not know the number of "safety" men included in this number or the number of "safety" men at present employed at pits not producing coal.

Lieut. - Commander KENWORTHY: What about the second part of my question as to the numbers not at work? Will the right hon. Gentleman answer that?

Colonel LANE FOX: That is simply a matter of arithmetical calculation by the hon. and gallant Gentleman, which he is probably much more capable of carrying out than I am.

STONE-DUSTING.

Mr. PALING: 26.
asked the Secretary for Mines for the date when the Regulations applying to stone dusting in coal mines were put into operation?

Colonel LANE FOX: These Regulations were made on 30th July, 1920, and came into force on 1st January, 1921.

Mr. PALING: Can the right hon. Gentleman state whether stone-dusting was in operation in past years, before 1914, for instance?

Colonel LANE FOX: It was certainly started, but it certainly was not enforced by Regulation until 1st January, 1921. The general effect upon the figures quoted by the hon. Gentleman means that the number of deaths per annum from accidents has enormously decreased.

Mr. PALING: Will the right hon. Gentleman deny that most of the pits in this country in 1913, 1914, and, particularly, 1915, were regularly using stone-dusting in order to mitigate the coal-dust accidents, and can he tell us how many of these pits, about these dates, were actually doing it and how many were not?

Colonel LANE FOX: If the hon. Member will put down a question I can give the particulars, but my impression is that stone-dusting was not general before the Regulations came into force.

Mr. PALING: But does not the information at the Ministry of Mines prove that most of the pits, the tremendous
majority, were actually doing this in 1914 and found it so beneficial that they actually continued it.

Mr. SPEAKER: The hon. Member must give notice of that question.

MUNICIPAL SUPPLIES.

Captain GARRO-JONES: 48.
asked the Prime Minister whether the Government propose to take any steps on the lines of the Coal Commission's Report to empower municipal authorities to supply their populations with coal at moderate prices?

Colonel LANE FOX: I have been asked to reply. I would refer the hon. Member to the reply I gave to a question by the hon. Member for Gateshead on the 28th June.

Captain GARRO-JONES: As that reply was not very clear, and it has since been made less clear, I wish to ask if the Government is in a position to say, in so far as this recommendation of the Coal Commission is concerned, the Government's contingent offer to accept the Report has not lapsed?

Colonel LANE FOX: I think the answer previously given was perfectly clear. As this statement has not yet been made, perhaps the hon. Member will be patient enough to wait for it.

Mr. PALING: Is this question still open for negotiation?

Colonel LANE FOX: I do not know what the hon. Member means by being "open for negotiation," but if he will wait a short time, he will know all about that.

Mr. PALING: I would like to ask whether, if circumstances crop up, the Government would be willing to negotiate on this question?

Colonel LANE FOX: I cannot possibly answer hypothetical questions of that kind.

Mr. T. WILLIAMS: Are we to understand that the Government have not yet made up their mind as to whether they will carry out this part of the recommendation?

Colonel LANE FOX: The hon. Member may take it from me that the answer is as it stands.

Mr. SPENCER: As this is a question of paramount importance at this moment, does the right hon. Gentleman not think that a clear and concise statement of the Government's policy upon this question to the House would be of the utmost importance.

Colonel LANE FOX: Yes, Sir; and I hope it will soon be made.

LOSS TO STATE.

Mr. PALING: 26.
asked the Minister of Labour the estimated loss to the country of the coal stoppage day by day and the total loss up to the present?

Mr. BETTERTON: I am unable to add to the reply which was given by my hon. and gallant Friend the Secretary for Mines to the hon. and gallant Member for Dulwich (Sir F. Hall) on 24th June.

Oral Answers to Questions — TRANSPORT.

ROAD SURFACE EXPERIMENTS.

Captain CROOKSHANK: 27.
asked the Minister of Transport whether he is availing himself of the provisions of last year's Act to experiment with road surfaces by grant from the Road Fund; and, if so, what has been the result of the experiments and where they are situated?

The MINISTER OF TRANSPORT (Colonel Ashley): Arrangements have been made to lay experimental lengths of road surface on the New Barnet bypass in the counties of Middlesex and Hertfordshire. Other experiments will probably be conducted on new arterial roads in Essex and Kent. Any indication of results must necessarily be deferred until the experimental sections have been subjected to traffic for a considerable period.

Mr. R. MORRISON: Can the Minister say whether the actual cost of these experiments will fall upon the Road Fund, or whether the local authorities in the areas will be asked to pay in support of them?

Colonel ASHLEY: I think I ought to have notice of that question, but my impression is that it will all fall upon the Road Fund.

Sir H. BRITTAIN: Can the right hon. Gentleman say whether the experimental section at Acton has been a success?

Colonel ASHLEY: No, Sir.

MOUNT VERNON STATION (ACCIDENT).

Mr. SULLIVAN: 28.
asked the Minister of Transport if his attention has been drawn to the death of a child, Thomas Shevlin, who was killed at Mount Vernon railway station on 28th May through the failure of the railway company to have the gate closed and no men on duty to keep children from getting into danger; and what steps is he taking in the matter?

Colonel ASHLEY: I have received reports of this accident both from the Procurator-Fiscal and from the railway company, but I do not think that on the facts disclosed there is any action that I could usefully take.

MOTOR DRIVERS (TECHNICAL TESTS).

Sir WILFRID SUGDEN: 29.
asked the Minister of Transport whether, in view of the increasing toll of accidents by motor-cars and motor haulage and the increasing congestion of roads, he will consider proposals for instituting a technical test of driving and engineering for all persons possessing driving licences?

Colonel ASHLEY: I am disposed to agree with the conclusion arrived at by the Departmental Committee on the Taxation and Regulation of Road Vehicles, as stated in their Second Interim Report, that any advantages which at first sight might appear likely to result from the institution of tests on the lines indicated, would be outweighed by the expense, difficulties and disadvantages inseparable from any such system. I have, however, under consideration in connection with legislation for the better regulation of road vehicles, the question of the issue of drivers' licences to persons suffering from physical disability.

Sir W. SUDDEN: In consideration of the fact that from Saturday afternoon to Sunday midnight there were 23 accidents in this country ranging from Aberdeen to Brighton, on the one hand, and from East to West, on the other, seven of them fatal, and in consideration of the fact that there are provided by the Automobile Association definite and exact tests which cover the position, will not the right hon.
Gentleman at once institute protection by these means for the travelling public?

Mr. SPEAKER: I think the hon. Gentleman is putting the same question again in longer terms.

Oral Answers to Questions — POST OFFICE.

ACCOMMODATION, SPRINGBURN.

Mr. HARDIE: 30.
asked the Postmaster-General if any developments are taking place for better post office accommodation for the Springburn district, Glasgow?

The POSTMASTER-GENERAL (Sir William Mitchell-Thomson): In the absence of suitable alternative premises for the Springburn Town Sub-office, it has been necessary to renew the lease of the existing premises for a further year from Whit Sunday last. Quite recently, however, my attention was drawn to premises which, while suitably situated, contain a much larger area than is required for the purpose of this particular office, and the possibility of devising an economical scheme for using these premises is at present under examination.

Mr. HARDIE: Can the other parts not be used as a garage?

Sir W. MITCHELL-THOMSON: As I have said, the suggested premises are too big for a post office, but the possibility of using part of them for this purpose and part for other purposes of the Service is under consideration.

TELEPHONE KIOSKS, SOUTHWARK.

Colonel DAY: 31.
asked the Postmaster-General whether the Metropolitan Borough Council of Southwark have given their approval of the erection of telephone kiosks in that borough; and will he state the positions, or proposed positions, of such kiosks?

Sir W. MITCHELL-THOMSON: The Southwark Council have given their general sanction to the erection of telephone kiosks in the borough; and five have so far been erected, at the south ends of London, Blackfriars and Southwark Bridges, in Borough High Street near St. George's Church, and in London Road. Further sites in the borough are being sought.

Colonel DAY: Would the right hon. Gentleman kindly try and obtain some sites in Central Southwark, so that it shall not be entirely neglected?

Sir W. MITCHELL-THOMSON: In any question of sites we communicate with the borough council, but I will bear the suggestion of the hon. and gallant Gentleman in mind.

MUNICIPAL SAVINGS BANKS.

Mr. AMMON: 33.
asked the Postmaster-General whether his attention has been called to a report of the finance committee of the London County Council, issued in February last, on the subject of municipal savings banks, in which is embodied criticism of the Post Office savings banking, and suggestions made for the improvement and popularising the facilities of the Post Office Savings Bank; and whether he will give attention to the proposals with a view to their adoption?

Sir W. MITCHELL-THOMSON: The report has been received, and the points in question are being considered.

Commander WILLIAMS: Will the right hon. Gentleman give us his assurance that he will do everything possible to encourage these small capitalists?

TELEPHONE INSTALLATIONS.

Lieut. - Commander KENWORTHY: 36.
asked the Postmaster-General in which exchange areas comprised in the London district there is a delay of more than three weeks in installing new telephones, and in which areas are applicants informed that their orders cannot be extended owing to shortage of plant?

Sir W. MITCHELL-THOMSON: With the exception of Wallington and Wimbledon the conditions to which the hon. and gallant Member refers do not obtain in the whole of any exchange area, but there are certain streets and groups of streets in a number of areas where, pending the completion of new exchanges or underground cables, the installation of new telephones has to be temporarily deferred.

Oral Answers to Questions — BROADCASTING.

UNLICENSED WIRELESS SETS.

Sir H. BRITTAIN: 32.
asked the Postmaster-General whether the appeal by the British Broadcasting Company to owners
of unlicensed wireless sets to pay for their licences has had any noticeable effect; and whether it is intended to reiterate this appeal from time to time?

Sir W. MITCHELL-THOMSON: The number of wireless licences issued shows a steady increase, but it is impossible to say to what extent the increase is attributable to the practice of broadcasting notices concerning the use of unlicensed wireless sets. These notices are broadcast periodically because the owners of unlicensed sets sometimes profess. when questioned, to be unaware of the legal obligation to obtain a licence, though this is, of course, no excuse in case of a prosecution.

Sir H. BRITTAIN: 34.
asked the Postmaster-General what number of owners of wireless sets have been prosecuted up to the present for not being in possession of a licence; whether any such owners have been proceeded against on more than one occasion; and what is the maximum penalty which has been inflicted?

Sir W. MITCHELL-THOMSON: The number of persons prosecuted for the use of unlicensed wireless apparatus since the passage of the Wireless Telegraphy (Explanation) Act last Autumn is 296. Up to the present it has not been necessary to prosecute any person more than once. The maximum penalty imposed was £10 in addition to £10 costs.

Sir H. BRITTAIN: Can the right hon. Gentleman say how ninny licences have been cancelled after this admitted evasion of the law?

Sir W. MITCHELL-THOMSON: Not without notice of the question.

ALTERNATIVE PROGRAMMES.

Colonel DAY: 35.
asked the Postmaster-General the result of the experimental alternative programmes test made by the British Broadcasting Company; and whether it is likely that such alternative programmes will be made a permanent feature of British broadcasting?

Sir W. MITCHELL - THOMSON: Authority has been given to the British Broadcasting Company to conduct a series of tests in the simultaneous transmission of different programmes from two stations in close proximity. The tests
are not yet completed, and it is not yet possible to make any statement as to their result.

AGRICULTURAL WORKERS (ACQUISITION OF LAND).

Major Sir ARCHIBALD SINCLAIR: 37.
asked the Minister of Agriculture whether his attention has been drawn to Section 10 of the Government White Paper on Agricultural Policy; and whether it is his intention to introduce legislation with the object of providing that the bona fide agricultural worker will be assisted to acquire as his own property a cottage and a small area of land which he can cultivate in addition to his earnings?

The MINISTER of AGRICULTURE (Mr. Guinness): I hope to be able to introduce at an early date a Bill to enable local authorities to continue and extend the provision of small holdings The Bill will embody the proposals to which the hon. and gallant Baronet refers.

Mr. HURD: Are we likely to have the Measure before the Recess?

Mr. GUINNESS: Certainly.

EMPIRE PRODUCE (MARKETING).

Mr. FOOT MITCHELL: 38.
asked the Minister of Agriculture whether, in connection with the grant of £1,000,000 to the Empire Marketing Board, he can now state what sum is to be allocated to protect the interests of home producers and the directions in which it is proposed that this sum should be spent?

Mr. GUINNESS: The Empire Marketing Board is now considering various proposals which will, it is hoped, assist the marketing of home produce, but they do not feel that the general purposes for which the grant was proposed would best be served by the allocation in advance of a specific sum for the furtherance of home interests only.

Sir H. BRITTAIN: Can the right hon. Gentleman give any indication as to when the allocation is likely to be commenced?

Mr. GUINNESS: Various proposals have been put forward and are being considered.

Mr. A. V. ALEXANDER: Do we understand that the Empire Marketing Board is administering both funds for British and Empire Produce?

Mr. GUINNESS: They will make grants for approved purposes.

GOLD MINING (MORTALITY STATISTICS).

Lieut.- Commander KENWORTHY: 40.
asked the Secretary of State for the Colonies the death and sickness rate amongst the natives employed in the goldmining industry of the Gold Coast Colony during the last complete year for which statistics are available?

The UNDER-SECRETARY of STATE for the COLONIES (Mr. Ormsby-Gore): From figures which have been supplied to me by the Officer Administering the Government of the Gold Coast it would appear that the death rate per thousand amongst all labour, surface and underground, in the goldmines in the Gold Coast is approximately 8.3. No reliable figures are available as to the sickness rates.

Mr. RENNIE SMITH: Can the hon. Gentleman say what is the death-rate of those who go down into the mines?

Mr. ORMSBY - GORE: I asked for those figures, but it is rather difficult to give combined figures for the surface and underground workers in the case of the Gold Coast mines, many of which are merely workings on the side of a hill as it is hard to differentiate absolutely between underground and surface workers. The mines are not like the coalmines in this country.

Mr. SMITH: But does not the hon. Gentleman realise that this is a very heavy percentage, and is he taking actual steps to try to secure a reduction in these figures.

Mr. ORMSBY-GORE: Considerable reductions have been made. As a matter of fact, it is not a heavy figure compared with the ordinary death rate. In tropical Africa the death rate and the birth rate are both vastly higher than in
this country, and in view of that fact I am rather surprised that 8.3 per 1,000 should be the figure in this case.

IRAQ (JEWISH EMIGRANTS).

Colonel WEDGWOOD: 41.
asked the Secretary of State for the Colonies whether he has any information as to a number of Jewish immigrants to Palestine being held up on their way in Iraq for want of permits to enter Palestine; and will he make inquiries on the subject of the Iraq Government, and take steps to hasten the issue of permits, in order that they may proceed on their journey before their resources are exhausted?

Mr. ORMSBY-GORE: I would refer the right hon. and gallant Member to the reply which I gave yesterday to the hon. and gallant Member for Hull (Lieut.-Commander Kenworthy).

KENYA (MUNICIPAL GOVERNMENT INQUIRY).

Colonel WEDGWOOD: 42.
asked the Secretary of State for the Colonies whether, in view of the fact that Mr. Justice Feetham has been appointed to make recommendations to the Colonial Office on alterations in the constitution of Kenya, he can assure the House that an official majority will be retained in the Legislature until the natives are fit to bear their part in the government of the country?

Mr. ORMSBY-GORE: The right hon. and gallant Member will have learnt from my reply to the question of the hon. and learned Member for Orkney (Sir R. Hamilton) yesterday that the inquiry concerns only municipal government. The matter on which he desires an assurance does not therefore arise.

Colonel WEDGWOOD: While I am very grateful to the hon. Gentleman for his answer to the first part of the question, may I ask him whether he can answer the second part—whether he can assure the House that an official majority will be retained in the Legislature until the natives are fit to bear their part in the government of the country.

Mr. ORMSBY-GORE: I cannot possibly commit future governments or Secretaries of State for all time, and this is a hypothetical question. The question of the revision of the Kenya Constitution is not under consideration in any way, and therefore it depends on the future as to when and how the Colony will eventually get self-government. It is impossible to make a statement to-day.

Colonel WEDGWOOD: Is the hon. Gentleman aware that, in re-organising local government in Nairobi and Mombasa, the question whether natives and Indians should have votes on a common register would have an intimate relationship with the question of the revision of the Constitution?

Mr. ORMSBY-GORE: I should hope it would have no relation. It is not intended that this purely local question should in any way affect the Constitution or the franchise settlement come to under the White Paper of 1923.

Colonel WEDGWOOD: Is it not intended to give votes to the natives and Indians in municipal government affairs?

Mr. ORMSBY-GORE: I have no idea whether the question is coming up at all.

FACTORY BILL.

Dr. WATTS: 43.
asked the Home Secretary if it will be possible to introduce the Factory Bill before the end of the present Session?

The UNDER-SECRETARY of STATE for the HOME DEPARTMENT (Captain Hacking): I would refer my hon. Friend to the answer which my right hon. Friend the Home Secretary gave on the 28th June to the hon. Member for Central Southwark (Colonel Day).

UNEMPLOYED DEMONSTRATION (PROHIBITION).

Mr. LANSBURY: 44.
asked the Home Secretary by whose authority the officials connected with the Metropolitan police prohibited a demonstration of the unemployed which was organised to take place on Sunday, 3rd July; and will he state whether it is now the policy of his Department to forbid all such demonstrations in London?

Captain HACKING: The demonstration referred to was prohibited by the Commissioner of Police in accordance with the authorisation of my right hon. Friend given under the Emergency Regulations. The powers thus given are not exercised unnecessarily.

Mr. LANSBURY: May I ask whether it is the policy of the Department to prohibit all public meetings in London under the Emergency Powers Regulations?

Captain HACKING: No, Sir. It is quite clearly laid down in Regulation 22 that, where there appears to be reason to apprehend that the assembly of any persons for the purpose of holding any meeting or procession may conduce to a breach of the peace, that then only would the meeting be prohibited.

Mr. LANSBURY: May I ask whether the hon. and gallant Member is aware that there have been hundreds of marches to Trafalgar Square during the last year or two and no disturbance of any kind; and can he give the House any evidence on which either the police or the Home Secretary had reason to fear there would be a disturbance on this occasion?

Captain HACKING: I could give the hon. Member much evidence if he would give me notice, but I cannot now give him evidence as to this particular case.

Sir F. MEYER: Is it not the fact that all these marches and demonstrations are a nuisance to 99 per cent. of the population?

Oral Answers to Questions — LEAGUE OF NATIONS.

BRITISH WOMAN DELEGATE.

Captain WEDGWOOD BENN: 45.
asked the Prime Minister whether it is the intention of His Majesty's Government to send a woman as a fully accredited delegate to the Assembly of the League of Nations in September?

The PRIME MINISTER (Mr. Baldwin): Yes, Sir. It is proposed to include a woman in the delegation as is usual. If the hon. and gallant Member cares to question me on Monday next, I hope I may then be in a position to give the names of the six British delegates.

COLONIAL MANDATES.

Mr. NOEL BUXTON: 46.
asked the Prime Minister whether he is aware that the claim of Germany to participate in the grant by the League of Nations of Colonial mandates was recognised by the Locarno Agreement; and whether the recent statement of the Secretary of State for the Colonies that the Tanganyika mandate is permanent represents the policy of the Cabinet?

The PRIME MINISTER: The right hon. Gentleman is under a misapprehension. The question of Colonial mandates is not dealt with in the Locarno Agreement at all. On the other hand, as explained by the Under-Secretary of State for Foreign Affairs to my hon. and gallant Friend the Member for Westbury (Captain W. Shaw) on 18th March, it was indicated to the German delegation at Locarno verbally that Germany, when a member of the League, would be a possible candidate for Colonial mandates like all other members. It is incorrect, however, to suggest that any promise or undertaking was given to the German Government. In regard to the second part of this question the answer is in the affirmative.

Mr. BUXTON: Can the Prime Minister assure the House that the attitude of the Government in regard to future mandates and possible German occupation has not been modified since Locarno?

The PRIME MINISTER: Oh, certainly not.

Captain BENN: Do we understand that it is the view of the Government that despite the over-riding authority of the League of Nations under Article 22, a mandatory Power holds it mandate in perpetuity?

The PRIME MINISTER: I do not think that follows. Obviously, it is subject to the League. The basis of this question was whether anything settled at Locarno affected the question of mandates, and the answer is No.

Captain BENN: But the second part of this question asks whether this mandate is permanent, and I ask whether the Government recognise the over-riding authority of the League to terminate or modify it?

The PRIME MINISTER: The Treaty of Versailles governs it. I have not got the wording of the relevant Clause in my mind, but everything is subject to the action of the League under the Treaty of Versailles.

DISARMAMENT.

Mr. BUXTON: 61.
asked the Secretary of State for Foreign Affairs whether he has taken steps to secure from the technical experts of the Admiralty, War Office, and Air Ministry draft plans for a treaty for the reduction and/or limitation of naval, land, and aerial forces, which might serve the League of Nations Preparatory Committee on Disarmament as a basis of discussion?

Mr. LOCKER-LAMPSON: No, Sir. The basis for discussion at the Preparatory Committee on Disarmament, which met on the 18th May last, was a questionnaire approved by the Council of the League.

LONDON BRIDGES (ROYAL COMMISSION).

Colonel GRETTON: 47.
asked the Prime Minister if he can make any announcement as to the appointment of the Royal Commission to inquire into the question of the London bridges and their approaches; and what will be the terms of reference?

The PRIME MINISTER: No, Sir. I am not yet in a position to make any statement.

Colonel GRETTON: Will the right hon. Gentleman bear in mind that this question is urgent?

The PRIME MINISTER: I am aware of that, and I am considering it.

LAW OFFICERS (FEES).

Captain BOURNE: 51.
asked the Chancellor of the Exchequer whether the payment of fees for contentious business to the Attorney-General and Solicitor-General for England is still governed by the terms of the Treasury Minute of 5th July, 1895?

Mr. CHURCHILL: Yes, Sir.

FRENCH DEBT TO GREAT BRITAIN.

Captain GARRO-JONES: 52.
asked the Chancellor of the Exchequer whether he has received any communication from M. Caillaux in regard to the French debt or asking for assistance of any kind in stabilising the French exchange?

Mr. CHURCHILL: I am in communication with the French Government, as I have been with former Governments, with regard to the settlement of the French War Debt; but I am not at present in a position to make any announcement on this matter. I have received no communication with regard to the stabilisation of the French exchange.

Captain GARRO-JONES: May I ask the right hon. Gentleman whether he does not consider that it is time to take up a sterner attitude in this matter?

EXCHEQUER GRANTS (MESTON COMMITTEE'S REPORT).

Captain GARRO-JONES: 53.
asked the Chancellor of the Exchequer whether he has received any further communication from Lord Meston?

Mr. CHURCHILL: No, Sir.

Mr. JOHNSTON: In view of the statement made by the Financial Secretary to the Treasury on a recent Motion for the Adjournment, does the Chancellor of the Exchequer intend to allow this matter to rest where it is?

Mr. CHURCHILL: My difficulty has been to disturb it from the rest into which it has fallen, but as I have already said we are proceeding ourselves to inquire into this subject, and the delay will not be allowed to prevent any legislative action which may ultimately be found to be necessary.

Colonel DAY: Are negotiations going on with M. Caillaux?

Mr. CHURCHILL: We are now on Lord Meston.

Oral Answers to Questions — GOVERNMENT DEPARTMENTS.

PRINTING ESTABLISHMENTS.

Mr. NAYLOR: 54.
asked the Financial Secretary to the Treasury what is the cause of the delay in presenting the
Report of the Committee of Inquiry into the working of Government printing establishments, who, according to a reply given on the 10th June, 1925, completed the taking of evidence on the 18th December, 1924; who, according to a further reply given on the 28th July, 1925, were considering their Report, which it was hoped would be presented to the House before the end of the year at least; who, in March of this year, were to meet again to consider the Report as soon as it had been printed; and whether he can now state definitely when the Report will be presented to the House?

The FINANCIAL SECRETARY to the TREASURY (Mr. Ronald McNeill): I understand that the revised draft of the Report is now ready for printing, and that the Committee will be meeting shortly to consider it. I am not able to state the cause of the delay, or when the Report will be presented to the House.

Mr. NAYLOR: 55.
asked the Financial Secretary to the Treasury whether he is aware that the chapel representatives of the unions whose members are employed at His Majesty's Stationery Office printing establishments have been deprived of the privilege of collecting members' contributions in the works, as is the general custom of the trade; will he state for what reason this practice has been vetoed by the management; and whether he will make representations to the management with a view to this privilege being restored, in conformity with the Prime Minister's appeal to employers generally?

Mr. McNEILL: The collection at the works of contributions from the members of trade unions employed at His Majesty's Stationery Office printing establishments has not been prohibited, but such collection is no longer allowed to be made during official hours or in the workshops, etc.; this change in practice has been made in order to bring His Majesty's Stationery Office printing establishments in this respect into conformity with the rules and regulations applying to Government workshops and factories generally. Moreover, I understand that it is not the general custom of the printing trade to allow the collection of trade union members' contributions during working hours on the factory premises.
I am not prepared to give instructions for the alteration of the present arrangement.

Mr. NAYLOR: Are we to understand by the reply given by the right hon. Gentleman that the unions are now permitted to collect contributions on the premises after working hours.

Mr. McNEILL: Yes, that is so.

ENEMY DEBTS CLEARING HOUSE (STAFF).

Colonel GRETTON: 57.
asked the Financial Secretary to the Treasury when the numbers of the staff at the clearing house for enemy debts at Cornwall House, Stamford Street, were last considered; and can he state the numbers of the staff on 1st July, 1925 and 1st January and 1st July, 1926?

Sir P. CUNLIFFE-LISTER: I have been asked to reply. The staff of the Clearing Office (Enemy Debts), which includes the Departments for the administration of German, Austrian, Bulgarian and Hungarian property, is under constant review by the Board of Trade in consultation with the Treasury. This staff numbered 1,096 on the 1st July, 1925; 945 on the 1st January, 1926; 889 on the 1st July, 1926.

SUDAN (RESIGNATION OF GOVERNOR-GENERAL).

Captain CROOKSHANK: 58.
asked the Secretary of State for Foreign Affairs whether the Governor-General of the Sudan has resigned his post; and whether he can make a statement on this subject?

The UNDER-SECRETARY of STATE for FOREIGN AFFAIRS (Mr. Godfrey Locker-Lampson): Yes, Sir. Sir Geoffrey Archer, Governor-General of the Sudan, has been medically advised that it is essential for him to have at least a year in a temperate climate after some 25 years' continuous service in tropical Africa, and as it is impossible to leave the Sudan without a Governor-General for so long a period, His Majesty's Government have been regretfully compelled to accept his resignation. It is hoped that after a sufficient period rest his health may be sufficiently restored to enable him to continue his career of public service under less trying climatic conditions.

ABYSSINIA.

Mr. BUXTON: 60.
asked the Secretary of State for Foreign Affairs whether the Government of Abyssinia has been consulted during the recent negotiations between the British and Italian Governments regarding Abyssinian territory?

Mr. LOCKER-LAMPSON: I would refer the right hon. Gentleman to the reply given to the hon. and gallant Member for Central Hull on the 30th of June.

Captain BENN: Is the hon. Gentleman aware that that reply gave no explicit answer to the question whether the Abyssinian Government was willing voluntarily to concede these British and Italian claims?

Mr. LOCKER - LAMPSON: The Abyssinian Government has been acquainted with these negotiations from the start.

Captain BENN: Has the hon. Gentleman ever heard of Morocco?

ETON RURAL DISTRICT COUNCIL (PAYMENT OF WAGES).

Colonel DAY: 62.
asked the Minister of Health the reason for the suggestion of the new auditor to his Department that the Eton Rural District Council pay their workmen by cheque?

The PARLIAMENTARY SECRETARY to the MINISTRY of HEALTH (Sir Kingsley Wood): It appears that, under the system in force in this district for the payment of workmen's wages, the preparation of the wages lists, the certification of the amounts due to each man, and the making of the actual payments, are in the hands of officers of the same branch. Experience has shown that such a course does not afford adequate security against irregularities, and that it is desirable that the duty of making the payments should be severed from that of preparing and certifying the lists. I understand that the auditor's suggestion was made with a view to securing this result.

Colonel DAY: Is the hon. Gentleman aware that it is very inconvenient for a workman to try and get a cheque cashed?

Sir K. WOOD: I have made inquiries, and I do not understand that any inconvenience of that kind has arisen. If the hon. and gallant Gentleman has any information on that point, I shall be glad to receive it.

Colonel DAY: Did not one of the local government board auditors, some years ago, in connection with the Post Office, condemn the paying of workmen by cheques?

Sir K. WOOD: I am not aware of that, but, as I have said, if the hon. and gallant Member has any information with respect to this matter, I shall be glad to receive it.

Major-General Sir ALFRED KNOX: With regard to this question, Mr. Speaker, may I ask your guidance? Is it customary in this House for an hon. Member who has no connection whatsoever with a constituency to put a question with regard to that constituency without previously referring to the sitting Member?

Mr. MARDY JONES: Is it not often very necessary that other Members should put such questions, because the Members for the constituencies concerned are neglecting their duties?

HON. MEMBERS: Withdraw!

Mr. SPEAKER: I do not think there is any rule that I can lay down on the matter.

Major COLFOX: Is it in order for one Member to say that another Member neglects his duties?

Mr. SPEAKER: I am afraid that that is a suggestion which I have heard from all quarters of the House.

Oral Answers to Questions — HOUSING.

WORKING DAYS, TORQUAY.

Commander WILLIAMS: 63.
asked the Minister of Health how many working days were lost in the housing schemes, and the drainage in connection with these schemes, under the Acts of 1923 and 1924, respectively, through men leaving work during the general strike in the Torquay area?

Sir K. WOOD: The Torquay Town Council inform me that there was no
stoppage on houses being erected for the council under the 1924 Act during the general strike, but that in most cases building on houses being erected by private enterprise under the 1923 Act was stopped. It is not possible to give an exact figure as to the number of man-days lost, but it appears that most builders had men idle for periods varying from six to 16 days.

Commander WILLIAMS: Does my hon. Friend know why stoppages have occurred on what is generally known as the Chamberlain scheme, but not on the Wheatley scheme?

Mr. T. WILLIAMS: If any stoppage did take place, as indicated in the reply, was it not due to the fact that the houses erected under the 1924 Housing Act were for working-class people, while the others were for those who never did any work?

Sir K. WOOD: No, Sir; I think the hon. Gentleman is under a complete mis-apprehension. This is the first time I have heard that distinction drawn, and, as far as I know, there is no necessity for it.

Mr. CLYNES: Is it not the case that, at the beginning of the general strike, the Trades Union Congress leaders expressly appealed to men working on housing schemes not to cease work?

Sir K. WOOD: That may well have been so, but, apparently, no notice was taken of it.

Commander WILLIAMS: Is not my hon. Friend also aware that the trade unions in this particular instance have not only stopped the building of housing, but have also fined some of their members for doing work on housing?

Mr. KIRKWOOD: rose—

Mr. SPEAKER: We cannot now debate the matter.

Mr. KIRKWOOD: Arising from the Parliamentary Secretary's previous reply, I would like to put it to him if it is not the case that those who never work at all, and who should be working, live in the very best houses in this country?

Mr. SPEAKER: That is a debating point.

Mr. MACLEAN: rose—

Mr. SPEAKER: The matter is one for debate; we cannot pursue it now.

HOUSING SHORTAGE, PLYMOUTH.

Mr. HORE-BELISHA: 64.
asked the Minister of Health if he can now make a statement as to the steps that have been taken by his Department in connection with the Plymouth housing shortage?

Sir K. WOOD: I regret that I am not yet in a position to add to the reply which was given to a similar question which the hon. Member addressed to me on the 29th ultimo.

Mr. HORE-BELISHA: Can the hon. Gentleman say when he anticipates that he will be able to say something about this matter, and, still more, when he will be able to do something?

Sir K. WOOD: I am afraid I cannot give any indication at the present time. I will communicate with the hon. Member as to when we shall be prepared to make a statement on the matter.

Mr. HORE-BELISHA: Can the hon. Gentleman say if anything is being done at all at the present moment?

Sir K. WOOD: Yes, Sir; communications are passing between the Admiralty and my Department.

Commander WILLIAMS: Were any of these houses dropped during the strike?

HON. MEMBERS: Dropped from where?

Mr. SPEAKER: The hon. and gallant Member had better put that question down.

AGRICULTURAL WORKERS.

Mr. KELLY: 65.
asked the Minister of Labour how many wage-earners there are in Great Britain; how many agricultural workers are at present employed; and how many workers normally engaged on the land are at present employed?

Mr. BETTERTON: The total number of wage-earners in Great Britain, as nearly as I can estimate, is between 16,000,000 and 17,000,000. As regards the second and third parts of the question, the only figure I can give is that for the number of workers employed on agricultural holdings of more than one acre on 4th June, 1925, namely, 925,400. According to my information, there is very little unemployment at present among regular agicultual workers.

Mr. T. WILLIAMS: Does the figure of 925,400 include the farmers on small and larger holdings?

Mr. BETTERTON: No, Sir; it includes persons who come within the category of agricultural workers in relation to wage-earning.

PROFIT-SHARING.

Sir W. SUGDEN: 67.
asked the Minister of Labour what steps he is instituting as to considered schemes of co-partnership, profit-sharing, and other methods of better agreement in industry, with a view of application to those industries which have shown an increasing number of labour disputes?

Mr. BETTERTON: Information is published from time to time in the "Labour Gazette" and in other official documents as to the progress of schemes of co-partnership and profit-sharing in private firms, and as to the working of the very varied machinery for discussion and negotiation which exists in industries. I may draw my hon. Friend's attention, in particular, to the volume on industrial relations recently published by the Balfour Committee. The good offices of my Department are always at the disposal of representatives of industry who wish for assistance in the development of machinery for avoiding disputes.

Sir W. SUGDEN: May I ask my hon. Friend, while informing him that I have read the Balfour Report three times, if he is now prepared to consider a revaluation of the unit of production which will permit of a higher standard of life and a greater competitive power in the world markets for all those firms who agree to participate in it?

Mr. SPEAKER: That question would require analysis.

MEXICO (BRITISH CREDITORS).

Sir CYRIL COBB: 56.
asked the Financial Secretary to the Treasury whether he is aware that the Mexican Government has not yet fulfilled those obligations to its British creditors which are now due in accordance with the revised agreement signed in the autumn of 1925; and whether he will take measures to ascertain the intentions of the Mexican Government with regard to future half-yearly payments?

Mr. LOCKER-LAMPSON: I am informed that the Mexican Government have now remitted the instalment due under the agreement on these obligations.

SAFEGUARDING OF WAGES AND HOURS OF LABOUR.

Mr. HADEN GUEST: I beg to move,
That leave be given to bring in a Bill to provide for minimum rates of wages and maximum hours of labour in industries protected from foreign competition.
This is designed to meet what appears to be a very obvious defect in the legislation of the country. I moved an Amendment to the Clause in the Finance Bill imposing a duty on wrapping paper. That Clause was designed to secure that the men employed in that industry should receive an increase of wages and a guarantee that the hours would not be made longer after the duty was imposed. It appears to me that the principle of providing for an increase in the remuneration of workers in an industry that is protected from foreign competition by the imposition of a tariff, and for the maintenance of the standard of their hours of labour, is one which it is very difficult for Members on any side of the House to desist. Members of the party opposite when they are advocating methods of protection, or the safeguarding of industries, speak of industry as a whole, but it is a fact that when a duty is imposed, while it is quite certain in the opinion of hon. Members opposite that the industry will receive a benefit, while they state that the men who have their capital invested will get a better return on that capital, and while they think there will be more profits in the industry, there is a defect in existing legislation in that there is no provision that there should be a corresponding improvement with regard to the remuneration and the condition of those employed in the industry. The workers, in fact, are left out of consideration as a definite factor. They are lumped into the industry in general. This Bill is meant to remedy that defect. It is meant to insure that when any duty is imposed on any article manufactured in this country which is supposed to be a protection against foreign competition, if the duty is 16 per cent., there should be a 4 per cent. increase in wages, if 20 per cent. it
is to be a quarter of 20 per cent.—in fact, a quarter of the rate of the duty that is imposed.
When these matters of safeguarding and Protection have been before the House from time to time, Members on the other side have been loud in their protestations of a desire to improve the lot of the workers. This Bill is designed to give hon. Members a chance of implementing their good feeling. When the safeguarding of industries legislation was first being discussed in this House, the discussion taking place on the White Paper that was first published, I asked the President of the Board of Trade if it was not possible to give us an assurance that they would strengthen what I might call the labour side of the White Paper and pay more attention than on the face of it was inteneded by the White Paper to the actual conditions of the workers and their standard of life. The right hon. Gentleman said all the reasoning of my speech was the basis of the object of the policy of safeguarding, that is to say, the improvement of the conditions of the workers, and it would be one of the objects of the Committees set up under the safeguarding procedure to try to maintain higher standards of life for our workers. He also said that I might rest assured that what I said was not only implicit in the instructions but really one of the great root causes and the justification of the whole policy. If that is really so it seems to me that the Government and hon. Members opposite cannot resist this Bill, because it is intended to implement that promise of the President of the Board of Trade. This Bill makes it not a promise, not a matter of good intentions only, but a definite obligation that when any tariff is imposed the workers shall get a definite, defineable share in any advantage which accrues.
I do not want to be regarded as accepting Protection as a policy. I am accepting the facts of the case as they are at the present time. It is safe to say that so long as the present Government is in office we are likely to have a good many instalments of Protection under one name or another. We ought to recognise that fact. The Labour approach to these problems would be a different one. Accepting the facts of the present political situation, lamentable as that is, we ought to see that the workers get a share of the advantages which accrue
from any legislation. By this Bill I want to establish a new principle in British legislation. At the present time, men speak as though it was only industry as a whole which is our concern, and that labour was only a constituent to be considered, like machinery or anything else that is used in the industry. Labour is not a constituent. Labour claims to be an equal partner and to be considered as an equal partner. It is for that reason that I put forward this Bill. The Bill is a modest one: it makes no extravagant claim, but it is the assertion of a principle which is of vital importance and one that should be part of the fundamental considerations always kept in mind in this House when we consider legislation. For these reasons, I hope the House will accept the Bill, will allow it to be brought in and read the First time.
Question put, and agreed to.
Bill ordered to be brought in by Mr. Haden Guest, Mr. Thomas Johnston, Mr. Dennison, Mr. Scurr, and Mr. Lansbury.

SAFEGUARDING OF WAGES AND HOURS OF LABOUR BILL,

"to provide for minimum rates of wages and maximum hours of labour in industries protected from foreign competition," presented accordingly, and read the First time; to be read a Second time upon Thursday, 15th July, and to be printed. [Bill 151.]

SELECTION (STANDING COMMITTEES).

STANDING COMMITTEE A.

Mr. WILLIAM NICHOLSON reported from the Committee of Selection; That they had added the following Member to Standing Committee A (in respect of the Judicial Proceedings (Regulation of Reports) Bill): Captain Hacking.

Report to lie upon the Table.

BILLS REPORTED.

Margate Corporation Bill [Lords],

Reported, with Amendments [Title amended], from the Local Legislation Committee (Section B): Report to lie upon the Table, and to be printed.

Kidderminister and Stourport Tramways Bill [Lords>],

Reading University Bill [Lords],

Reported, with Amendments; Reports to lie upon the Table, and to be printed. Falmouth Docks Bill [Lords],

Reported, without Amendment; Report to lie upon the Table.

Bill to be read the Third time.

NURSING HOMES (REGISTRATION).

Report from the Select Committee, with Minutes of Evidence and Appendices, brought up, and read.

Report to lie upon the Table, and to be printed. [No. 103.]

MIDWIVES AND MATERNITY HOMES BILL.

Lords Amendments to be considered upon Wednesday, 14th July, and to be printed. [Bill 152.]

Orders of the Day — FINANCE BILL.

As amended, considered.

NEW CLAUSE.—(Amendment as to deduction of Income Tax from rent.)

Rule 1 of No. VIII. of Schedule A shall have effect as though after the words "person receiving the rent shall" there were inserted the words "on production of the receipt for the payment of the tax," and Rule 2 thereof shall have effect as though for the words "who pays the tax" there were substituted the words "to whom a deduction is to be allowed under the preceding rule."—[Mr. Ronald McNeill.]

Brought up, and read the First time.

The FINANCIAL SECRETARY to the TREASURY (Mr. Ronald McNeill): I beg to move, "That the Clause be read a Second time."
This New Clause is in pursuance of a promise made on the Committee stage of the Bill. It is not a matter of very great importance, but my right hon. Friend recognised that there was a reasonable case to be met, that in cases where an occupying tenant is called upon to pay the Property Tax and has the right of deducting that amount from the sum paid in rent, he should be called upon to produce the receipt for the actual payment of the tax, in order that there may be definite proof in the hands of the landlord that the demand has been met and the tax paid. It seems a reasonable proposition, and when it was brought to our notice that the existing law did not enable a demand for the receipt to be made, my right hon. Friend agreed to put it into the Finance Bill.

Major HILLS: This Clause is moved to meet an Amendment which stood in the names of the hon. Member for Down (Mr. D. Reid) and myself. It makes the law clear, and restores what was the practice for a great many years until a reverse decision was given, that while the tenant is entitled to deduct the amount of the tax from his rental, the landlord has the right to call for the receipt for the tax when he allows the deduction. I thank my right hon. Friend for the concession made, which will restore the old practice and put an end to something which is causing very great inconvenience and even loss.

Question put, and agreed to.

Clause read a Second time, and added to the Bill.

NEW CLAUSE.—(Amendment of s. 24 of Finance Act, 1923.)

In the case of an assessment to Income Tax made at any time after the fifth day of April, nineteen hundred and twenty-three, an application under Section twenty-four of the Finance Act, 1923 (which relates to relief in respect of error or mistake), may be made at any time not later than six years after the end of the year of assessment within which the assessment was made.—[Mr. McNeill]

Brought up, and read the First time.

Mr. McNEILL: I beg to move, "That the Clause be read a Second time."
This Clause is also put down in fulfilment of a promise made during the Committee stage. The case was presented to the Committee by my hon. Friend the Member for Guildford (Sir Henry Buckingham), and the Chancellor of the Exchequer then said that if my hon. Friend would withdraw the Clause which was down for consideration in Committee, but was not in the best form for carrying out the object in view, on the Report stage he would put down a New Clause to carry out the object. The Clause requires very little explanation. It is not very often that Clauses in the Finance Bill are so simple. It carries on the face of it what it is intended to do. It gives the taxpayer who wishes to make a claim for redress in respect of any error of assessment made against him, the opportunity of doing that for a period of six years instead of three years under the existing law. My right hon. Friend in accepting the principle said that it would be necessary to make the concession entirely prospective and not retrospective. That has been carried out in the terms of the new Clause.

Sir HENRY BUCKINGHAM: On behalf of future generations of taxpayers I thank the Chancellor of the Exchequer for having kept his promise in regard to this matter. I only regret that he has not seen his way to make the Clause retrospective, in which case it would have covered certain hard cases which I have in mind. Future generations of taxpayers will, however, always be grateful to my right hon. Friend for this concession.

Question put, and agreed to.

Clause read a Second time, and added to the Bill.

NEW CLAUSE.—(Amendment of 15 and 16 Geo. V., c. 36, S. 15.)

Sub-section (1) of Section fifteen of the Finance Act, 1925 (which makes allowances in respect of earned income), shall have effect as if for the words "one-sixth" there were substituted the words "one-fifth."—[Mr. J. Hudson.]

Brought up, and read the First time.

Mr. J. HUDSON: I beg to move, "That the lause be read a Second time."
4.0 P.M.
Last year the present allowance of one-sixth was introduced by the Chancellor in place of the former allowance of one-tenth at a cost, so he has informed us, of some £7,500,000 to the public Treasury. The Chancellor, during a recent Debate on this matter, took the opportunity to say that although he had himself made this advance, an earlier Chancellor of the Exchequer, the right hon. Gentleman the Member for Colne Valley (Mr. Snowden) had missed his chance and had not taken his opportunity to advance the claims of the particular taxpayers whom we are dealing with in connection with this Clause. That contention may have been effective as a passing debating point, but none the less I suggest it is rather childish, in view of the fact that it is well known that the Labour Chancellor of the Exchequer acted to a very considerable extent for the advantage of the persons who would be covered by the Clause which we are now discussing.
The Chancellor himself said in a subsequent Debate on the Inhabited House Duty that the general advantage that the direct taxpayer obtains through the remission of indirect taxation had gone far to remove some of the heavier burdens put upon them. It can hardly be held by the present Chancellor of the Exchequer that situated, as my right hon. Friend was, with the necessity of producing a Budget in an extremely short space of time after a period of extraordinarily bad financial mismanagement on the part of the Government which preceded him—that under conditions of that sort all the advantage that ought to be given to this class of taxpayer or to that class of taxpayer could be carried through. At least it must be admitted, and I understand the right hon. Gentleman does not attempt to deny this, that
the Labour Chancellor of the Exchequer, in addition to making considerable reliefs for this class of taxpayer, also made it clear that in a subsequent Budget he intended to deal with the proposal that I am now putting before the House. Unfortunately for the present Chancellor of the Exchequer the change that he effected was made at a time when, as he himself said, he was endeavouring to balance every advantage that he gave by some countervailing disadvantage. He was, for example, giving alleviation to Super-tax payers and at the same time, as he said, he was putting on an extra burden in the form of increased Death Duties. I never quite saw that that was a countervailing disadvantage, for the Death Duties—

Mr. SPEAKER: That appears to be a general review, not only of the past Budgets, but of the last two Budgets. I am afraid that if I allowed it, it would be repeated on each Amendment The argument here is about a concession asked for. I must ask the hon. Member to come to the proposition which he is putting before the House, and not to enter into a general review.

Mr. HUDSON: I bow with great respect to your ruling, but find it difficult none the less to follow it as the right hon. Gentleman himself on the occasion of the Debate on this matter when it was last before the House did go at some length into this very question of the relationship of the present proposal to the proposals which might have been dealt with, as he ventured to put it to the House, at the time when my right hon. Friend the Member for Colne Valley was Chancellor of the Exchequer, and I was endeavouring to cover my tracks in this matter and make it impossible, as I hoped, for the Chancellor of the Exchequer to bring forward this argument against me, as he did on former occasions when he brought it forward, in connection with this very point I am making, against the hon. Member for Peckham (Mr. Dalton) who raised a similar matter. But I will not, in view of the ruling you have given, push that matter any further. If I may proceed—

Mr. SPEAKER: I am much obliged to the hon. Member. Possibly it was only
the exuberance of the Chancellor of the Exchequer which may have led him away on the earlier occasion.

The CHANCELLOR of the EXCHEQUER (Mr. Churchill): I am sure you, Mr. Speaker, do not intend by that to suggest that the Chair was not keeping me strictly within the limits of order on that occasion.

Mr. SPEAKER: No, not at all.

Mr. HUDSON: I venture to pass on to this further point, that the need for further alleviation for this class of Income Tax payer will be seen if it is remembered that in a previous Budget there was a remission of taxation to Income Tax payers of £39,500,000—at least that was the sum that was estimated—but the alleviation which was secured by the proposal for the change from one-tenth to one sixth was only £7,500,000. There was, therefore, for Income Tax payers generally, a further alleviation and a lightening of their burden to the extent of some £32,000,000, which is more than four times as great as the sum which was granted as an alleviation to the particular class of taxpayer whom I am now dealing with.

Mr. CHURCHILL: That particular class of taxpayer also participated in the effect of the general remission in the flat rate of Income Tax, and to a very large extent the benefit they gained is greater under the general remission of flat rate than that which they gained by this special relief.

Mr. HUDSON: Of course one must bow to the great authority of the Chancellor of the Exchequer, who has the figures behind him.

Mr. CHURCHILL: It is a commonplace.

Mr. HUDSON: I am not so sure that it is a commonplace, especially when you take, for example, a figure of this sort. If you take the people who are assessed for Super-tax, that is to say, people whose incomes are in excess of £2,000 per annum, there were 87,000 such people in the year 1924, who were assessed on a total income of £504,000,000, so that in regard to this remission of 6d. in Income Tax, the gain made by these 87,000 people as the result
of the Chancellor's proposals, which he now suggests were fairly equally scattered over all classes of taxpayers, was actually to them something between £10,000,000 and £12,000,000. I want to suggest that that class of Income Tax payers did very much better out of the Chancellor's remission of Income Tax than the class that I am particularly discussing in the Motion now before the House.
The view that I take of this issue is this, that the present Chancellor's acceptance in a former year of a certain remission to this class of Income Tax payer was altogether inadequate in view of the principles which he himself had laid down. I feel that whatever gain these taxpayers obtained a year ago from the particular remission which was then made, that gain has practically been entirely taken away by other taxes upon just the same class of people. Very probably—and it is according to the theory of the right hon. Gentleman in his last Budget—the man who got his remission from one-tenth to one-sixth has more than made up for the remission by paying increased taxes through the increased amount that his wife has to pay for her silk clothes, that his son has to pay very probably for his motor bicycle, or that the family has to pay for the piano or gramophone for the general needs of the family. The Chancellor has added to the burden of taxes, and has about balanced whatever benefit was obtained for this class of taxpayer, and I am, therefore, urging that there is a special reason on this occasion why some effort should be made to remit the tax in the way which I am now proposing.
There is this further reason for considering the proposal which I am making, that there has been during the last four years of industrial difficulty a very remarkable increase in the power to pay Income Tax of a certain class of Income Tax payer, while the people I am here dealing with in this proposal are very probably the people who have travelled along the same path as most of the wage-earners have travelled in the last four years. As we know, the wage earners have had their wages reduced to a point at which they are getting less now, at the rate of £10,000,000 per week, than they were getting four years ago. There is another class of Income Tax payers, for example, those whose power to pay
may be measured by the estates that they finally leave at death—a class of infinitely greater ability, as will be seen from the estates that were left in excess of £10,000 in value in the year 1920–21. Estates of that character in that year were left to an amount valued at £253,000,000, but four years later the same class of estates had increased to an amount of £315,000,000, and that notwithstanding that money values had altered in the period which really makes the £315,000,000 actually greater than the sum stated. I admit, of course, with regard to the £10,000,000 decrease in the matter of wages that one must bring in also the same process of alteration in money values, but I submit to the Chancellor of the Exchequer that, had he been looking for a place where the burden could have been better borne, and had he desired really to help this class of Income Tax payers and similar Income Tax payers, it would have been much easier for him to place the burden on those who by the estates ultimately left at death have proved their increasing capacity to pay this type of taxation.
There is too the final point, that the collection of the type of tax we are now discussing is a very wasteful process. The large number of people who are now paying Income Tax, if this proposal was carried out, would not pay any tax at all. The Chancellor of the Exchequer did not seem to apprehend this point when this matter was last discussed by the House; that if these people were removed from the tax collector's register it would save the tax collector an inordinate amount of trouble. The Chancellor of the Exchequer in his former days, when he was not so unregenerate as he is now from the point of view of the old standards of political economy, used to quote Adam Smith—that was in the heyday of his free trade enthusiasm—and no doubt he will remember the fourth canon that Adam Smith laid down—namely, that every tax ought to be so contrived as to take out and to keep out of the pockets of the people as little as possible over and above what it brings into the public treasury. But the collection of this tax, particularly with regard to the people on the margin, is an expensive process. It leads to all sorts of correspondence between the tax collectors and the taxed, and it is probably very little would be lost to the
Exchequer if the proposal we are suggesting was adopted.
The main duty of statesmen who desire to place taxes in a way that the community as a whole can bear them best is to find an increasing chance for the standard of life of the mass of the producers in the community to rise, while those whose incomes are far and above the general standard of life should be made to bear an increasing proportion of the burdens of the country. The more you tax the small Income Tax payer the more difficult is it for him to become an effective producer. Free him to-day of the burdens he is bearing and you will give him an opportunity of becoming a better producer, and in that sense you will make it possible for the community to bear burdens which at the present time it cannot bear. In the interests of these general considerations I submit that the Chancellor of the Exchequer should accede to our request and make the change from one-sixth to one-fifth.

Mr. LEES-SMITH: I beg to second the Motion.
This is the only new Clause we are carrying from the Committee stage, but it is one to which we attach considerable importance and on which we propose to take a Division. The proposal is quite simple. At present those whose income depends on earnings are allowed a deduction of one-sixth as against those whose incomes come from investments. We consider that the deduction is altogether insufficient and we propose to increase it to one-fifth as a first stage. The Chancellor of the Exchequer should bear in mind that in this proposal we are supported by what was the practice of the Income Tax until the year 1919. Up to that year, if you take the tax paid at the lower rate, there was a difference of one-third in favour of those whose incomes depend upon their earnings, a deduction twice the rate now allowed. Our view is that the present very meagre and inadequate deduction deals very harshly—this is not a question of rich and poor, but of men whose incomes are derived from professional work or from investment—with the small Income Tax payers, who have to work for every penny they earn and it gives undue consideration to those whose incomes come from inheritance or investments which accrue to them, so to speak, in their sleep
without any anxiety or personal exertion. This can be made plain by considering the position of a small but fairly comfortable professional man. Take the doctor who is earning £600 a year. He is allowed to deduct one-sixth of his income before he pays the tax, and therefore he pays upon £500.
Compare him with his neighbour who is living upon War loan and receiving £500 a year. They both pay the same rate of tax, and our contention is that the economic situation of the two is totally different. The doctor has £100 more, but his income is dependent upon all the chances and anxieties of life. If he falls ill it disappears. If he dies, or retires, it disappears; while the man who is living on £500 from War loan or investments need not trouble about anyone but himself because whatever happens to him his wife and dependants are secure of the income to which they have been accustomed. As a matter of fact, the difference between these two classes of taxpayers can be reduced to figures. Take a doctor earning £600 a year. What is he worth? I believe a doctor when he retires and sells his practice it is usual to capitalise his earnings at three years, and a doctor earning £600 a year is worth £1,800. What is the man worth who is getting £500 a year from War loan? He is worth about £10,000, and the present practice of the Income Tax is to assume that a man with a capital of £1,800 behind him has the same ability to pay taxation as the man who has £10,000 behind him. That is the reason why we say that the present Income Tax militates against the active working and vital elements in the production of national wealth and gives an undue advantage to mere passive and inactive ownership of wealth which comes from the community, without any personal anxiety or energy on their part.

Mr. CHURCHILL: This Clause was moved in Committee by another hon. Member on the Front Opposition Bench and it is identical in terms with the proposal then moved. No one will dissent from many of the arguments that have been used in favour of the principle of discriminating in favour of earned as against unearned income. Personally I agree with that principle, and my adherence to it has constantly been ex-
pressed, not only in words but by deeds as well, for in the last Session of Parliament I increased the discrimination in favour of earned income as against unearned income from one-tenth to one-sixth, at a cost to the Exchequer of £7,500,000. The hon. Member who moved this new Clause and the hon. Member who seconded it are endeavouring to lead the country and the House to suppose that they are ardent advocates of the principles they have preached, but, unfortunately, I found it necessary to point out in the Debate on the Committee stage that when the Labour party was in office, and the right hon. Gentleman the Member for Colne Valley (Mr. Snowden) was Chancellor of the Exchequer, an identical motion in principle was moved by a Liberal Member. There was a fine opportunity for the Labour party and the Chancellor of the Exchequer of that time to show how deep and strong was their adhesion to the principle we have heard so ably ex-pounded this afternoon. But the right hon. Gentleman the Member for Colne Valley was not able to listen to the Liberal counsels which were offered. He put the Government Whips on, and by a majority of 187 to 63, on the 8th July, 1924, he rejected this proposal altogether.
I do not for a moment mention these facts in order to found an accusation against the right hon. Gentleman. I only bring them forward to show how little ground hon. Members opposite have for founding an accusation against me. The hon. Member who has moved this new Clause has told us that the right hon. Gentleman was in great difficulties when he was in office because of the bad management of financial matters by his Conservative predecessors. One of the difficulties of the right hon. Gentleman, as the result of the Conservative administration of the finances of this country, was that he found himself with a surplus of £40,000,000, but the right hon. Gentleman, surveying the whole field of taxation, found many other means of spending this immense sum which Conservative thrift had accumulated, and the cause which relatively appealed less to his heart was the cause of adding to the discrimination in favour of earned as against unearned income. The right hon. Gentleman will say, and the hon. Member who has moved this
new Clause has said already, that he showed his sympathy for this class of taxpayer by other remissions of taxation. That may be true, but I am making these remissions too.
Those remissions which he made reduced the revenue of the State, and I am carrying on and renewing this year, as I did last year, all these remissions on tea and sugar, the inhabited House Duty, and other taxation which my predecessor made. I have saved them all, and have been trying to get on without them, and in addition I have given away on this very subject last year £7,500,000 in relief of this particular class of people. It is on top of that relief which we gave last year that the party opposite now come forward and ask us to give another remission of about £3,400,000. I am unable to find the revenue for such a remission at the present time, and, considering the manner in which this branch of our taxation system was treated last year, and the large remission that was then given, if I had the £3,400,000 in hand, this is not the immediate use which I think I should make of it. I am unable to accept the Amendment, and I am sure that the hon. Member who moved the Clause anticipated that I should not. I make no apology for not being able to accept it. We have, in fact, done far more than has ever previously been done for this class of taxpayer, and we have done it in spite of many difficulties. It may be that the taxpayers in question will not be entirely satisfied, and that they would be glad to see further remissions. It may be that they will make complaints, and perhaps they are entitled to make complaints, but the one class of persons in the whole world Who are not entitled to make complaints are those hon. and right hon. Members belonging to the Labour party who repulsed even the smallest suggestion of giving relief to this class of taxpayer only two years ago.

Captain WEDGWOOD BENN: There is a Standing Order No. 19, under which I have suffered, which forbids the repetition of your own arguments or those of other people, and I was wondering whether the Chancellor of the Exchequer himself might not fall under the censure of that Standing Order in the course of the speech which he has just made. He
repeated the whole of the speech he made in Committee on this subject, and to what does it amount? It amounts to this, that the Chancellor of the Exchequer in the late Government resisted this Amendment, and that the Conservative party all supported it. The Chancellor of the Exchequer went on to say that the late Chancellor enjoyed the benefit of £40,000,000 which had been saved by Conservative thrift during 1923. It is a strange thing that, that being so, the present Chancellor himself, in 1923, was denouncing the same Conservative Government up and down the country and presenting himself for election as one of their opponents. Of course, you have to judge all these concessions and remissions in the general light of the Budget, and I am not sure how I voted on this question last year. Very likely I voted with the Chancellor of the Exchequer, and, if so, I am not ashamed; very likely I voted against him, and, if so, I am equally not ashamed. But we have to view the question in the light of the Budget, and the fact of the matter then was that, as the right hon. Member for Colne Valley (Mr. Snowden) said, he had made very wide and valuable remissions of taxation to the poorer class of taxpayer. The Chancellor of the Exchequer now tells us that he is continuing all those remissions, and he is claiming all the merit of the Labour party's Budget.

Mr. CHURCHILL: Not all.

Captain BENN: Well, he is claiming a proportion of it, but he has forgotten to say that he himself has imposed a great deal of new indirect taxation, on gloves and gas mantles, and a thousand other things have been taxed and prices raised against the people for whom some slight remission is now sought. Therefore, if the hon. Member who moved the Amendment thinks fit to divide on it, shall certainly support him, without any qualms, because whereas I believe that, in the Budget of 1924 the right principle was followed, and the right people were assisted, I believe the contrary to be the case in the Budget of 1926.

Mr. GRIFFITHS: I was disappointed to hear the Chancellor of the Exchequer say that he was unable to find the revenue. I have here the Report of the Commissioners of Inland Revenue, and
if the right hon. Gentleman would examine it, he would, I believe, be able to find the £3,000,000 for which we are now asking. I would like to call his attention to two or three of the figures in that Report. In 1918–19 the class of taxpayers for whom we are asking this relief numbered something like 3,900,000, and in 1924–25 they had been reduced to 2,400,000—that is, a reduction of 1,500,000—and the reason for that reduction is on account of the reduced wages that had been imposed on the working classes throughout the country during the later years. On the other hand, we find that the Super-tax payers, to whom the Chancellor of the Exchequer gave a relief of about £10,000,000 last year, which is also being continued this year, numbered, in 1914, 14,008 and in 1923–24, 83,375, so that the Income Tax payers for whom we are asking relief had been reduced in numbers by 1,500,000, while the Super-tax payers had increased from 14,008 to 83,375.

Mr. CHURCHILL: The poorer classes were reduced in numbers because of the lower level of exemption, which removed large numbers from taxation altogether.

Mr. GRIFFITHS: Not so much as by the great reductions in the wages and people not being able to pay.

Mr. CHURCHILL: That is not so.

Mr. GRIFFITHS: The amount for which the Super-tax payers were assessed for tax in 1914 was £175,000,000, and in 1924–25 it was £516,000,000, or an increase of 300 per cent.

Mr. BASIL PETO: Has the hon. Member reckoned that in the earlier year Super-tax commenced at £5,000 a year, which was a totally different basis?

Mr. GRIFFITHS: Yes, I have. The Chancellor of the Exchequer said that he was unable to find the revenue. I will give him some figures to show where he can get the revenue.

Mr. SPEAKER: That is scarcely permissible to-day. It is a thing that might be repeated on every single Amendment, and we cannot on each Amendment review the whole balance of taxation.

Mr. GRIFFITHS: You are always very fair in Debate, Mr. Speaker, and surely I ought to be able to reply to the
Chancellor of the Exchequer, who said he was unable to find the revenue. I want to show within the Report of the Commissioners where he can get it.

Mr. SPEAKER: If I allowed that, I might have from another quarter a plea for more protective tariffs, and so on, as a means of getting the money, and the hon. Member will see where we should be landed in that case.

Mr. GRIFFITHS: I will take another line and deal with the debts owed by different people in the country to the Chancellor of the Exchequer. There is owing in Income Tax £25,000,000—

Mr. SPEAKER: That argument, again, might be repeated on every single Amendment.

Mr. GRIFFITHS: I am sorry. There is only one point that struck me in the Chancellor's speech, and that was when he said that the Income Tax payers for whom we are seeking relief have received the benefit not only of remissions given by himself, but of remissions given by the ex-Chancellor of the Exchequer. That, however, cuts both ways, because the Super-tax payers and others have also had the relief given by the ex-Chancellor. I will keep what further I have to say till the Third Reading.

Mr. GILLETT: The speech of the Chancellor of the Exchequer has been correctly stated to have been the speech delivered on this subject in Committee, and it left us in the same position as that in which we were before. I quite agree that it might be said to be a good debating answer, and I do not know that I should have intervened now, had it not been to express my disappointment with the closing words of the speech, because it seemed to me that what he said with regard to what he would do if he had the money indicated that possibly he did not feel the importance of this question quite as much as some of us do. I should, therefore, like to suggest to the right hon. Gentleman that this is really a case that ought to be considered at some time, when there is any money to spare, and I hope he will put it among the subjects for consideration when the better times come, of which, I suppose, every Chancellor of the Exchequer is thinking. If you take the case my hon. Friend has taken of a person, like a doctor, who is
making £1,000 a year, and a person who is drawing a £1,000 a year from investments, each of them having a wife and two children, it is needless to point out the different positions in which those two people are placed. On the supposition that the doctor has no other means of income, in order to provide for his wife and children, he must be laying aside, whether by insurance or otherwise, a considerable part of his income, while, on the other hand, the fortunate possessor of the capital necessary to bring in £1,000 a year, to a large extent, if he is satisfied with that income, need not be making any provision by saving.
Therefore, it seems to me that this is a subject which should commend itself to a Conservative Chancellor of the Exchequer, because if there is any part of the House from which we constantly hear lectures on the importance of saving it is from hon. Members opposite. This is the sort of thing at which I should have thought the Chancellor of the Exchequer would look with favour, because it would help the man who in all probability would save the money if only the right hon. Gentleman would leave it in his pocket, in order to give him the opportunity

of laying a certain amount of capital aside. It seems to me that the answer of the Chancellor of the Exchequer, while we enjoyed the amusement of it, and while it may for the moment have seemed to shatter the importance of the late Chancellor of the Exchequer, does seem to me to have taken very slight note of this exceedingly important question, which affects a very large number of people. I hope the Chancellor of the Exchequer will not be satisfied with the speech which he has twice given us, but that he will now seriously consider what is a very important question, and when we come next year to deal with this question and move this Amendment again I hope he will spare us that particular speech and, instead, give us a serious and carefully thought out argument on this subject. I hope, at the same time, that he will see his way to give a remission of taxation to a class of people who well deserve the attention of a Conservative Government

Question put, "That the Clause be read a Second time."

The House divided: Ayes, 123; Noes, 249.

Division No. 322.]
AYES.
[4.47 p.m.


Adamson, Rt. Hon. W. (Fife, West)
Greenwood, A. (Nelson and Colne)
Murnin, H.


Alexander, A. V. (Sheffield, Hillsbro')
Grenfell, D. R. (Glamorgan)
Naylor, T. E.


Ammon, Charles George
Griffiths, T. (Monmouth, Pontypool)
Oliver, George Harold


Attlee, Clement Richard
Groves, T.
Palin, John Henry


Baker, J. (Wolverhampton, Bilston)
Grundy, T. W.
Paling, W.


Barker, G. (Monmouth, Abertillery)
Guest, Haden (Southwark, N.)
Parkinson, John Allen (Wigan)


Barnes, A.
Hall, F. (York, W. R., Normanton)
Pethick-Lawrence, F. W.


Barr, J.
Hall, G. H. (Merthyr, Tydvil)
Ponsonby, Arthur


Batey, Joseph
Hamilton, Sir R. (Orkney & Shetland)
Potts, John S.


Beckett, John (Gateshead)
Hardie, George D.
Purcell, A. A.


Benn, Captain Wedgwood (Leith)
Harney, E. A.
Richardson, R. (Houghton-le-Spring)


Bowerman, Rt. Hon. Charles W.
Hartshorn, Rt. Hon. Vernon
Riley, Ben


Broad, F. A.
Mayday, Arthur
Rose, Frank H.


Bromley, J.
Hayes, John Henry
Runciman, Rt. Hon. Walter


Brown, James (Ayr and Bute)
Henderson, Right Hon. A. (Burnley)
Sakiatvala, Shapurji


Buchanan, G.
Hirst, G. H.
Salter, Dr. Alfred


Buxton, Rt. Hon. Noel
Hirst, W. (Bradford, South)
Scrymgeour, E.


Charleton, H. C.
Hore-Belisha, Leslie
Sexton, James


Clowes, S.
Hudson, J. H. (Huddersfield)
Shepherd, Arthur Lewis


Cluse, W. S.
John, William (Rhondda, West)
Shiels, Dr. Drummond


Clynes, Rt. Hon. John R.
Johnston, Thomas (Dundee)
Short, Alfred (wednesbury)


Collins, Sir Godfrey (Greenock)
Jones, Henry Haydn (Mcrioneth)
Sitch, Charles H.


Compton, Joseph
Jones, Morgan (Caerphilly)
Smith, H. B. Lees (Keighley)


Cowan, D. M. (Scottish Universities)
Jones, T. I. Mardy (Pontypridd)
Smith, Rennie (Penistone)


Crawfurd, H. E.
Kelly, W. T.
Snell, Harry


Dalton, Hugh
Kennedy, T.
Snowden, Rt. Hon. Philip


Davies, Evan (Ebbw Vale)
Kenworthy, Lt.-Com. Hon. Joseph M
Spencer, George A. (Broxtowe)


Davies, Rhys John (Westhoughton)
Lansbury, George
Spoor, Rt. Hon. Benjamin Charles


Day, Colonel Harry
Lawson, John James
Stamford, T. W.


Dennison, R.
Lee, F.
Sullivan, J.


Dunnico, H.
Livingstone, A. M.
Thorne, G. R. (Wolverhampton, E.)


Evans, Capt. Ernest (Welsh Univer.)
Lowth, T.
Thurtle, E.


Fenby, T. D.
Lunn, William
Tinker, John Joseph


Gardner. J. P.
MacLaren, Andrew
Townend, A. E.


Gibbins, Joseph
Maclean, Neil (Glasgow, Govan)
Trevelyan, Rt. Hon. C. P.


Gillett, George M.
March, S.
Viant, S. P.


Gosling, Harry
Mitchell, E. Rosslyn (Paisley)
Walsh, Rt. Han. Stephen


Greenall, T.
Montague, Frederick
Watson, W. M. (Dunfermline)


Webb, Rt. Hon. Sidney
Williams, C. P. (Denbigh, Wrexham)
Wilson, R. J. (Jarrow)


Wedgwood, Rt. Hon. Josiah
Williams, David (Swansea, East)



Wiggins, William Martin
Williams, Dr..J. H. (Llanelly)
TELLERS FOR THE AYES.—


Wilkinson, Ellen C.
Williams, T. (York, Don Valley)
Mr. Charles Edwards and Mr. T.




Henderson.


NOES


Acland-Troyte, Lieut.-Colonel
England, Colonel A.
Macdonald, R. (Glasgow, Cathcart)


Agg-Gardner, Rt. Hon. Sir James T.
Erskine, Lord (Somerset, Weston-s.-M.)
McLean, Major A.


Ainsworth, Major Charles
Erskine, James Malcolm Monteith
Macnaghten, Hon. Sir Malcolm


Albery, Irving James
Evans, Captain A. (Cardiff, South)
McNeill, Rt. Hon. Ronald John


Alexander, E. E. (Leyton)
Faile, Sir Bertram G.
Macquisten, F. A.


Allen, J. Sandeman (L'pool, W.Derby)
Falls, Sir Charles F.
Maitland, Sir Arthur D. Steel


Amery, Rt. Hon. Leopold C. M. S.
Fanshawe, Commander G. D.
Malone, Major P. B.


Apsley, Lord
Fermoy, Lord
Manningham-Buller, Sir Mervyn


Ashley, Lt.-Col. Rt. Hon. Wilfrid W.
Feilden, E. B.
Margesson, Captain D.


Astbury, Lieut.-Commander F. W.
Forestier-Walker, Sir L.
Marriott, Sir J. A. R.


Astor, Viscountess
Foster, Sir Harry S.
Merriman, F. B.


Atholl, Duchess of
Foxcroft, Captain C. T.
Milne, J. S. Wardlaw


Baldwin, Rt. Hon. Stanley
Fremantle, Lieut.-Colonel Francis E.
Mitchell, S. (Lanark, Lanark)


Balfour, George (Hampstead)
Gadie, Lieut.-Col. Anthony
Mitchell, W. Foot (Saffron Walden)


Barnston, Major Sir Harry
Gates, Percy
Mond, Rt. Hon. Sir Alfred


Beamish, Captain T. P. H
Gibbs, Col. Rt. Hon. George Abraham
Monseil, Eyres, Com. Rt. Hon. B. M,


Beckett, Sir Gervase (Leeds, N.)
Gilmour, Lt.-Col. Rt. Hon. Sir John
Moore-Brabazon, Lieut.-Col, J. T. C.


Bellairs, Commander Carlyon W.
Glyn, Major R. G. C.
Moreing, Captain A. H.


Benn, Sir A. S. (Plymouth, Drake)
Goff, Sir Park
Morrison. H. (Wilts, Salisbury)


Bennett, A. J.
Gower, Sir Robert
Morrison-Bell, Sir Arthur Clive


Bentinck, Lord Henry Cavendish-
Grace, John
Nall, Lieut.-Colonel Sir Joseph


Berry, Sir George
Grant, Sir J. A.
Nelson, Sir Frank


Bethel, A.
Grattan-Doyle, Sir N.
Newman, Sir R. H. S. D. L. (Exeter)


Betterton, Henry B.
Greene, W. P. Crawford
Nicholson, Col. Rt. Hn. W. G.(Ptrst'ld.)


Bird, Sir R. B. (Wolverhampton, W.)
Gretton, Colonel Rt. Hon. John
Nuttall, Ellis


Blades, Sir George Rowland
Grotrian, H. Brent
O'Neill, Major Rt. Hon. Hugh


Boothby, R. J. G.
Guinness, Rt. Hon. Walter E.
Oman, Sir Charles William C.


Bourne, Captain Robert Croft
Gunston, Captain D. W.
Penny, Frederick George


Bowyer, Captain G. E. W.
Hacking, Captain Douglas H.
Percy, Lord Eustace (Hastings)


Boyd-Carpenter, Major Sir A. B.
Hail, Lieut.-Col. Sir F. (Dulwich)
Perkins, Colonel E. K.


Briggs, J. Harold
Hall, Capt. W. D'A. (Brecon & Rad.)
Perring, Sir William George


Briscoe, Richard George
Hammersley, S. S.
Peto, Basil E. (Devon, Barnstaple)


Brocklebank, C. E. R.
Hanbury, C.
Pleiou, D. P.


Brooke, Brigadier-General C. R. I.
Hannon. Patrick Joseph Henry
Pownall, Lieut.-Colonel Sir Assheton


Brown, Col. D. C. (N'th'I'd., Hexham)
Harland, A.
Preston, William


Buckingham, Sir H.
Harmsworth, Hon. E. C. (Kent)
Radford, E. A.


Bull, Rt. Hon. Sir William James
Harrison, G. J. C.
Ramsden, E.


Bullock, Captain M
Hartington, Marquess of
Rees, Sir Beddoe


Burgoyne, Lieut.-Colonel Sir Alan
Harvey, G. (Lambeth, Kennington)
Rentoul, G. S.


Burman, J. B.
Harvey, Major S. E. (Devon, Totnos)
Rhys, Hon. C. A. U.


Burton, Colonel H. W.
Haslam, Henry C.
Rice, Sir Frederick


Butler, Sir Geoffrey
Heneage, Lieut.-Col. Arthur P.
Roberts, E. H. G. (Flint)


Cadogan, Major Hon. Edward
Hennessy, Major J. R. G.
Robinson, Sir T. (Lancs., Stretford)


Caine, Gordon Hall
Herbert, S. (York, N.R., Scar. & Wh'by)
Ropner, Major L.


Campbell, E. T.
Hills, Major John Waller
Russell, Alexander West (Tynemouth)


Cautley, Sir Henry S.
Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.
Samuel, A. M. (Surrey, Farnham)


Cayzer, Sir C. (Chester, City)
Hogg, Rt. Hon. Sir D. (St. Marylebone)
Samuel, Samuel (W'dsworth, Putney)


Cecil, Rt. Hon. Sir Evelyn (Aston)
Hope, Sir Harry (Forfar)
Sanders, Sir Robert A.


Chadwick, Sir Robert Burton
Hopkins, J. W. W.
Sanderson, Sir Frank


Chamberlain, Rt. Hn. Sir J.A. (Birm., W.)
Hopkinson, Sir A. (Eng. Universities)
Shaw, Lt.-Col. A. D. Mcl. (Renfrew, W.)


Charteris, Brigadler-General J.
Hopkinson, A. (Lancaster, Mossley)
Shaw, Capt. W. W. (Wilts. Westb'y)


Churchill, Rt. Hon. Winston Spencer
Howard, Captain Hon. Donald
Shepperson, E. W.


Churchman, Sir Arthur C.
Hudson, Capt. A. U. M.(Hackney, N.)
Simms, Dr. John M. (Co. Down)


Clarry, Reginald George
Hudson, R. S. (Cumb'l'nd, Whiteh'n)
Sinclair, Col. T. (Queen's Univ., Belfast)


Clayton, G. C.
Huntingfield, Lord
Skelton, A. N.


Cobb, Sir Cyril
Hurd, Percy A.
Slaney, Major P. Kenyon


Cockerill, Brig.-General Sir G. K.
Hurst, Gerald B.
Smith, R. W.(Aberd'n & Kinc'dine, C.)


Colfox, Major Wm. Phillips
Hutchison, Sir Robert (Montrose)
Smithers, Waldron


Conway, Sir W. Martin
Inskip, Sir Thomas Walker H.
Somerville, A. A. (Windsor)


Cooper, A. Duff
Jacob, A. E.
Spender-Clay, Colonel H.


Cope, Major William
James, Lieut.-Colonel Hon. Cuthbert
Stanley, Col. Hon. G. F.(Will'sden, E.)


Couper, J. B.
Jephcott, A. R.
Steel, Major Samuel Strang


Craik, Rt. Hon. Sir Henry
Kidd. J. (Lin[...]thgow)
Stott, Lieut.-Colonel W. H.


Crooke, J. Smedley (Deritend)
Kindersley, Major Guy M.
Stuart, Crichton-, Lord C.


Crookshank, Col. C. de W. (Berwick)
King, Captain Henry Douglas
Stuart, Hon. J. (Moray and Nairn)


Curzon, Captain Viscount
Kinloch-Cooke, Sir Clement
Styles, Captain H. Walter


Daiziel, Sir Davison
Knox, Sir Alfred
Sueter, Rear-Admiral Murray Fraser


Davies, Dr. Vernon
Lister, Cunliffe, Rt. Hon. Sir Philip
Sugden, Sir Wilfrid


Davies, Sir Thomas (Cirencester)
Locker-Lampson, G. (Wood Green)
Templeton, W. P.


Davison, Sir W. H. (Kensington, S.)
Locker-Lampson, Com. O. (Handsw'th)
Thompson, Luke (Sunderland)


Dawson, Sir Philip
Lord, Walter Greaves-
Thomson, Rt. Hon. Sir W. Mitchell-


Drewe, C.
Laugher, L.
Tinne, J. A.


Eden, Captain Anthony
Lucas-Tooth, Sir Hugh Vere
Titchfield, Major the Marquess of


Edmondson, Major A. J.
Luce. Maj.-Gen. Sir Richard Harman
Tryon, Rt. Hon. George Clement


Elliot, Major Walter E.
Lynn, Sir R. J.
Turton, Sir Edmund Russborough


Ellis, R. G.
MacAndrew, Major Charles Glen





Vaughan-Morgan, Col. K. P.
White, Lieut.-Col. Sir G. Dairymple
Wood, Sir S. Hill- (High Peak)


Waddington, R.
Williams, Com. C. (Devon, Torquay)
Worthington-Evans, Rt. Hon. Sir L.


Wallace, Captain D. E.
Wilson, M. J. (York, N. R., Richm'd)
Wragg, Herbert


Warrender, Sir Victor
Wilson, R. R. (Stafford, Litchfield)
Young, Rt. Hon. Hilton (Norwich)


Watson, Sir F. (Pudsey and Otley)
Windsor-Clive, Lieut.-Colonel George



Watson, Rt. Hon. W. (Carlisle)
Wise, Sir Fredric
TELLERS FOR THE NOES.—


Watts, Dr. T.
Withers, John James
Mr. F. C. Thomson and Lord


Wells, S. R.
Womersley, W. J.
Stanley.


Wheler, Major Sir Granville C. H.
Wood, E.(Chest'r Stalyb'dge & Hyde)

NEW CLAUSE.—(Duties on table waters.)

As from the first clay of August, nineteen hundred and twenty-six, the Excise Duty chargeable under Section four of the Finance (New Duties) Act, 1916, as amended by Section eleven of the Finance Act, 1916. at the rate of eightpence per gallon on certain table waters known as unsweetened waters, and kept for sale in Great Britain and Northern Ireland, shall cease.—[Mr. B. Peto.]

Brought up, and read the First time.

Mr. B. PETO: I beg to move, "That the Clause be read a Second time."
Those duties were imposed during the War as a War measure, and bit by bit they have been remitted. In 1923 the duty on sweetened table waters was reduced to 2d., and in 1924 it was entirely repealed, but since then the duty of 8d. a gallon on unsweetened table waters has been retained. At the same time, the duty on cider, which contains at least a certain amount of alcohol, has been entirely removed. I propose to show the House that there are other than historical reasons for the Clause I am moving. Not only is this the last remission of a War duty which I think ought to be removed, but, owing to the imposition of this duty, there has been a great growth in the manufacture of soda water and other aerated waters by other means than those carried out in factories carrying on this trade. The use of sparklets has increased enormously. In one advertisement it is pointed out that by the use of this method you can save 3½d. on every syphon, while another points out that you can have a free trial and that you can produce a quart syphon of soda water and pay no duty at all. I am told by the Scottish Federation of Aerated Water Manufacturers that, prior to the imposition of this duty, there were practically no such things as soda water fountains known in Scotland. Now this means of producing soda water has increased enormously, and until quite recently it entirely escaped the attention of the Chancellor of the Exchequer.
5.0 P.M.
It is true they are now trying to bring this soda water fountain within the meaning of the Act, so far as this duty is concerned. The Scottish soda water manufacturers, however, say it is extremely doubtful whether the measures which have been taken to prevent evasion of duties by the users of the fountains will be successful. I have a copy here of an advertisement which has been put out for one of these soda fountains, and it states that at a cost of only 10s. 200 gallons can be produced, or 4,000 glasses. The duty on that quantity, produced in the ordinary factories for the production of soda water, would be £6 13s. 4d. I do not think the Chancellor of the Exchequer should put temptation on such a scale in the way of manufacturers of soda water and other aerated waters by maintaining this duty. There is another reason I want to put, and it is that this is practically the only duty which is collected simply on the declaration on the part of the trader or manufacturer that he has produced a certain quantity. It is found to be quite impossible to collect this duty in any other way. The Chancellor of the Exchequer has to trust to the honesty of the person producing it to say how much tax he ought to pay, and at the same time anyone can buy a box of sparklers and can produce soda water at home without any tax at all. I think it is time the Chancellor of the Exchequer did one of two things. Either he should quite simply tax these other methods of producing soda, water, by having a stamp upon each box of these sparklets exactly like on patent, medicines—it would be much easier to collect that part of the duty than the other—either he should do that and have a square deal, or else he should give it up altogether. The present duty depends entirely on the honesty of the manufacturer for being collected at all, and produces, I believe, a small amount of money. It is the last of these war-time duties which were always irritating and which have
gradually been removed until nothing now remains except the tax on plain water and unsweetened aerated water.

Mr. GREAVES-LORD: In order to try and remove every hindrance from those who want to drink pure and unadulterated water, even though it be in a bottle, I beg to second the Motion.

Mr. McNEILL: The hon. Member for Barnstaple (Mr. B. Peto) began with an argument with which we are very familiar, that is, that this duty is the remainder of a war measure or war tax. I believe that if we were strictly to investigate all our expenditure on a historical basis like that, we should find that Income Tax was also a war tax. I am afraid the finances of the country are not so far removed from the exigencies of a war period that we can afford to wipe out this revenue. But I do not think the hon. Member really relied on that historical argument. His real argument was that there is an inconsistency in putting this tax on one form of water and not on another, and he argues that measures should be taken to cover all competition. He referred to sparklets and soda water fountains, and put before us a most appalling state of affairs. I think he informed us that we could get no less than 400 glasses—I think I am right.

Mr. B. PETO: Four thousand glasses or 200 gallons.

Mr. McNEILL: He said 4,000 glasses of soda water could be made for 10s. by these soda water fountains, but does he suggest that any ordinary householder is likely to brew 4,000 glasses for his 10s. or does he mean that it is produced in this manner for sale?

Mr. B. PETO: For sale, undoubtedly. There are now more than 100 of these soda water fountains in Scotland alone.

Mr. McNEILL: Just so. If they are for sale, then they are under the duty now, and his only complaint is that the tax is not sufficiently covered, and that is a question of machinery. I do not know whether that is so or not. He only told us from his advertisement what might be. I have always noticed that advertisements always take a very indulgent view. It is quite likely that an advertisement will tell you that for 10s.
you can get a great quantity of soda water, but it does not at all follow that the means of doing so is used extensively. They may be used probably by individuals for their own private use for making their own drink. I do not see any objection to that. I do not see any reason why people should not make their own drink.

Major CRAWFURD: Will the right hon. Gentleman apply that to alcohol as well?

Mr. McNEILL: What the hon. Member for Barnstaple says here is that this particular sort of drink is not dutiable. Alcohol is dutiable, so I do not see really that the interruption of the hon. and gallant Member for West Walthamstow (Major Crawfurd) has any particular relevancy. The point really is a matter of commonsense. If there was a substantial sale or manufacture of this class competing with legitimate manufacture the question would be different, but all the information we have is that there is really no substantial evidence of competition. Having regard to the fact that there is a very considerable revenue derived from these waters, there is no evidence, as far as we know of, of mysterious interference with the trade from the figures we have as to the number of gallons produced, which is not an appalling quantity as it would be if this competition were gaining a hold. It is quite true that we have no figures to compare consumption now with consumption before the duty was put on, but year by year there is no sign of the consumption in unsweetened waters decreasing. As it brings in a revenue of …370,000, which is quite a substantial sum, we certainly cannot afford to throw that away. I submit that the hon. Member for Barnstaple does not succeed, even if all he has told us is in accordance with the facts, in showing that there is a strong case against taxing these waters. I hope, therefore, that he will not press his Amendment.

Mr. B. PETO: Will the right hon. Gentleman between now and the next Budget see the Scottish soda water manufacturers and also the London Federation of Mineral Water Manufacturers? All the figures I gave were based on actual facts supplied by the trade.

Mr. McNEILL: All I will say is that I had the opportunity not long ago of talking with a deputation representing this industry.

Question put, "That the Clause be read a Second time."

The House divide. Ayes, 121; Noes, 262.

Division No. 323.]
AYES.
[5.10 p.m.


Adamson, Rt. Hon. W. (Fife, West)
Hall, G. H. (Merthyr Tydvil)
Rose, Frank H.


Alexander, A. V. (Sheffield, Hillsbro')
Hamilton, Sir R. (Orkney & Shetland)
Runciman, Rt. Hon. Walter


Ammon, Charles George
Hardie, George D.
Saklatvala, Shapurji


Attlee, Clement Richard
Harney, E. A.
Salter, Dr. Alfred


Baker, J. (Wolverhampton, Bilston)
Hartshorn, Rt. Hon. Vernon
Scrymgeour, E.


Barker, G. (Monmouth, Abertillery)
Hayday, Arthur
Shepherd, Arthur Lewis


Barnes, A.
Henderson, Right Hon. A. (Burnley)
Shiels Dr. Drummond


Barr, J.
Henderson, T. (Glasgow)
Short, Alfred (Wednesbury)


Batey, Joseph
Hirst, G. H.
Sitch, Charles H.


Beckett, John (Gateshead)
Hirst, W. (Bradford, South)
Slesser, Sir Henry H.


Benn, Captain Wedgwood (Leith)
Hudson, J. H. (Huddersfield)
Smith, Ben (Bermondsey, Rotherhithe)


Bowerman, Rt. Hon. Charles W.
Hutchison, Sir Robert (Montrose)
Smith, H. B. Lees (Keighley)


Broad, F. A.
John, William (Rhondda, West)
Smith, Rennie (Penistone)


Bromley, J.
Jones, Henry Haydn (Merioneth)
Snell, Harry


Brown, James (Ayr and Bute)
Jones, Morgan (Caerphilly)
Snowden, Rt. Hon. Philip


Buchanan, G.
Jones, T. I. Mardy (Pontypridd)
Spencer, George A. (Broxtowe)


Buxton, Rt. Hon. Noel
Kelly, W. T.
Spoor, Rt. Hon. Benjamin Charles


Charieton, H. C.
Kennedy, T.
Stamford, T. W.


Clowes, S.
Kenyon, Barnet
Stephen, Campbell


Cluse, W. S.
Kirkwood, D.
Stewart, J. (St. Rollox)


Clynes, Rt. Hon. John R.
Lansbury, George
Sullivan, J.


Compton, Joseph
Lawson, John James
Sutton, J. E.


Cove, W. G.
Lee, F.
Thorne, G. R. (Wolverhampton, E.)


Cowan, D. M. (Scottish Universities)
Lindley, F. W.
Thurtle, E.


Crawfurd, H. E.
Livingstone, A. M.
Tinker, John Joseph


Dalton, Hugh
Lowth, T.
Townend, A. E.


Davies, Evan (Ebbw Vale)
Lunn, William
Trevelyan, Rt. Hon. C. P.


Davies, Rhys John (Westhoughton)
MacLaren, Andrew
Viant, S. P.


Day, Colonel Harry
Maclean, Nell (Glasgow, Govan)
Wallhead, Richard C.


Dennison, R.
March, S.
Walsh, Rt. Hon. Stephen


Dunnico, H.
Montague, Frederick
Watson, W. M. (Dunfermline)


Evans, Capt. Ernest (Welsh Univer.)
Morrison, R C. (Tottenham, N.)
Webb, Rt. Hon. Sidney


Gardner, J. P.
Murnin, H.
Wedgwood, Rt. Hon. Josiah


Gibbins, Joseph
Naylor, T. E.
Wheatley, Rt. Hon. J.


Gillett, George M.
Oliver, George Harold
Wiggins, William Martin


Gosling, Harry
Palin, John Henry
Wilkinson, Ellen C.


Graham, Rt. Hon. Wm. (Edin., Cent.)
Paling, W.
Williams, C. P. (Denbigh, Wrexham)


Greenall, T.
Parkinson, John Allen (Wigan)
Williams, David (Swansea, East)


Greenwood, A. (Nelson and Colne)
Pethick-Lawrenee, F. W.
Williams, Dr. J. H. (Llanelly)


Grenfell, D. R. (Glamorgan)
Peto, Basil E. (Devon, Barnstaple)
Williams, T. (York, Don Valley)


Griffiths, T. (Monmouth, Pontypool)
Ponsonby, Arthur
Wilson, R. J. (Jarrow)


Groves, T.
Potts, John S.



Grundy, T. W.
Purcell, A. A.
TELLERS FOR THE AYES.—


Guest, Haden (Southwark, N.)
Richardson, R. (Houghton-le-Spring)
Mr. Charles Edwards and Mr.


Hall, F. (York, W. R., Normanton)
Riley, Ben
Hayes.


NOES.


Acland-Troyte, Lieut.-Colonel
Briggs, J. Harold
Cockerill, Brig.-General Sir G. K.


Agg-Gardner, Rt. Hon. Sir James T.
Briscoe, Richard George
Colfox, Major Wm. Phillips 


Alnsworth, Major Charles
Brittain, Sir Harry
Conway, Sir W. Martin 


Albery, Irving James
Brooke, Brigadier-General C. R. I.
Cooper, A. Duff 


Alexander, E. E. (Leyton)
Brown, Col, D. C. (N'th'l'd., Hexham)
Cope, Major William


Alexander, Sir Wm. (Glasgow, Cent'l)
Buckingham, Sir H.
Couper, J. B.


Allen,J.Sandeman (L'pool, W. Derby)
Bull, Rt. Hon. Sir William James
Craik, Rt. Hon. Sir Henry


Amery, Rt. Hon. Leopold C. M. S.
Bullock, Captain M.
Crooke, J. Smedley (Deritend)


Apsley, Lord
Burgoyne, Lieut.-Colonel Sir Alan
Crookshank, Cpt. H. (Lindsey, Gainsbro)


Ashley, Lt.-Col. Rt. Hon. Wilfrid W.
Burman, J. B.
Cunliffe, Sir Herbert


Atholl, Duchess of
Burton, Colonel H. W.
Curzon, Captain Viscount


Baldwin, Rt. Hon. Stanley
Butler, Sir Geoffrey
Dalziel, Sir Davison


Balfour, George (Hampstead)
Cadogan, Major Hon. Edward
Davies, Dr. Vernon


Beamish, Captain T. P. H.
Caine, Gordon Hall
Davies, Sir Thomas (Cirencester)


Beckett, Sir Gervase (Leeds, N.)
Campbell, E. T.
Davison, Sir W. H. (Kensington, S.)


Bellairs, Commander Carlyon W.
Cautley, Sir Henry S.
Dawson, Sir Phillip


Benn, Sir A. S. (Plymouth, Drake)
Cayzer, Sir C. (Chester, City)
Dixey, A. C.


Bennett, A. J
Cazalet, Captain Victor A.
Drewe, C.


Bentinck, Lord Henry Cavendish-
Cecil, Rt. Hon. Sir Evelyn (Aston)
Eden, Captain Anthony


Berry, Sir George
Chadwick, Sir Robert Burton
Edmondson, Major A. J.


Bethel, A.
Chamberlain, Rt.Hn.Sir.J.A (Birm.,W.)
Edwards, J. Hugh (Accrington)


Betterton, Henry B.
Charteris, Brigadier-General J.
Elliot, Major Walter E.


Birchall, Major J. Dearman
Churchill, Rt. Hon. Winston Spencer
Ellis, R. G.


Bird, Sir R. B. (Wolverhampton, W.)
Churchman, Sir Arthur C.
England, Colonel A.


Blades, Sir George Rowland
Clarry, Reginald George
Erskine, Lord (Somerset, Weston.s.-M.)


Boothby, R. J. G.
Clayton, G. C.
Erskine, James Malcolm Monteith


Bourne, Captain Robert Croft
Cobb, Sir Cyril
Evans, Captain A. (Cardiff, South)


Faile, Sir Bertram G.
Knox, Sir Alfred
Samuel, A. M. (Surrey, Farnham)


Falls, Sir Charles F.
Lane Fox, Col. Rt. Hon. George R.
Samuel, Samuel (W'dsworth, Putney)


Fanshawe, Commander G. D.
Lister, Cunliffe-, Rt. Hon. Sir Philip
Sandeman, A. Stewart


Fermoy, Lord
Locker-Lampson, G. (Wood Green)
Sanders, Sir Robert A.


Fielden, E. B.
Locker-Lampson, Com. O.(Handsw'th)
Sanderson, Sir Frank


Forestier-Walker, Sir L.
Lord, Walter Greaves-
Scott, Sir Leslie (Liverp'l, Exchange)


Forrest, W.
Lougher, L.
Shaw, Lt.-Col. A. D. Mcl.(Renfrew,W.)


Foxcroft, Captain C. T.
Lucas-Tooth, Sir Hugh Vere
Shaw, Capt. W. W. (Wilts, Westb'y)


Frece, Sir Walter de
Luce, Maj.-Gen. Sir Richard Harman
Shepperson, E. W.


Fremantle, Lieut.-Colonel Francis E.
Lynn, Sir R. J.
Simms, Dr. John M. (Co. Down)


Gadie, Lieut.-Col. Anthony
MacAndrew, Major Charles Glen
Sinclair, Col. T.(Queen's Univ., Belfst.)


Gates, Percy
Macdonald, R. (Glasgow, Cathcart)
Skelton, A. N.


Gibbs, Col. Rt. Hon. George Abraham
McLean, Major A.
Slaney, Major P. Kenyon


Glyn, Major R. G. C.
Macmillan, Captain H.
Smithers, Waldron


Goff, Sir Park
Macnaghten, Hon. Sir Malcolm
Somerville, A. A. (Windsor)


Gower, Sir Robert
McNeill, Rt. Hon. Ronald John
Spender-Clay, Colonel H.


Grace, John
Maitland Sir Arthur D. Steel-
Stanley Col. Hon. G. F. (Will'sden,E.)


Grant, Sir J. A.
Malone, Major P. B.
Stanley, Lord (Fylde)


Grattan-Doyle, Sir N.
Manningham-Buller, Sir Mervyn
Stanley, Hon. O. F. G. (Westm'eland)


Greene, W. P. Crawford
Margesson, Captain D.
Steel, Major Samuel Strang


Gretton, Colonel Rt. Hon. John
Marriott, Sir J. A. R.
Stott, Lieut.-Colonel W. H.


Grotrian, H. Brent
Merriman, F. B.
Stuart, Crichton-, Lord C.


Guinness, Rt. Hon. Walter E.
Milne, J. S. Wardiaw-
Stuart, Hon. J. (Moray and Nairn)


Gunston, Captain D. W.
Mitchell, S. (Lanark, Lanark)
Styles, Captain H. Walter


Hacking, Captain Douglas H.
Mitchell, W. Foot (Saffron Walden)
Sueter, Rear-Admiral Murray Fraser


Hall, Lieut.-Col. Sir F. (Dulwich)
Mond, Rt. Hon. Sir Alfred
Sugden, Sir Wilfrid


Hall, Capt. W. D'A. (Brecon & Rad.)
Monsell, Eyres, Com. Rt. Hon. B. M.
Templeton, W. P.


Hammersley, S. S.
Moore, Lieut.-Colonel T. C. R. (Ayr)
Thompson, Luke (Sunderland)


Hanbury, C.
Moore-Brabazon, Lieut.-Col. J. T. C.
Thomson, F. C. (Aberdeen, South)


Hannon, Patrick Joseph Henry
Morden, Colonel Walter Grant
Thomson, Rt. Hon. Sir W. Mithchell-


Harland, A.
Moreing, Captain A. H.
Tinne, J. A.


Harmsworth, Hon. E. C. (Kent)
Morrison, H. (Wilts, Salisbury)
Titchfield, Major the Marquess of


Harrison, G. J. C.
Morrison-Bell, Sir Arthur Clive
Tryon, Rt. Hon. George Clement


Hartington, Marquess of
Nall, Lieut.-Colonel Sir Joseph
Turton, Sir Edmund Russborough


Harvey, G. (Lambeth, Kennington)
Nelson, Sir Frank
Vaughan-Morgan, Col. K. P.


Harvey, Major S. E. (Devon, Totnes)
Newman, Sir R. H. S. D. L. (Exeter)
Waddington, R.


Haslam, Henry C.
Nicholson, Col. Rt. Hn.W.G.(Ptrsf'ld.)
Wallace, Captain D. E.


Heneage, Lieut.-Colonel Arthur P.
Nuttall, Ellis
Warner, Brigadier-General W. W.


Hennessy, Major J. R. G.
O'Neill, Major Rt. Hon. Hugh
Warrender, Sir Victor


Herbert, Dennis (Hertford, Watford)
Oman, Sir Charles William C.
Watson. Sir F. (Pudsey and Otley)


Herbert, S. (York. N.R., Scar. & Wh'by)
Penny, Frederick George
Watson, Rt. Hon. W. (Carlisle)


Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.
Percy, Lord Eustace (Hastings)
Watts, Dr. T.


Hogg, Rt. Hon. Sir D. (St. Marylebone)
Perkins, Colonel E. K.
Wells, S. R.


Hope, Sir Harry (Forfar)
Perring, Sir William George
Wheler, Major Sir Granville C. H.


Hopkins, J. W. W.
Philipson, Mabel
White, Lieut.-Col. Sir G. Dairymple


Hopkinson, A. (Lancaster, Mossley)
Pielou, D. P.
Williams, A. M. (Cornwall, Northern)


Horlick, Lieut.-Colonel J. N.
Pilditch, Sir Philip
Williams, Com. C. (Devon, Torquay)


Howard, Captain Hon. Donald
Pownall, Lieut.-Colonel Sir Assheton
Wilson, M. J. (York, N. R., Richm'd)


Hudson, Capt. A. U. M. (Hackney, N.)
Preston, William
Wilson, R. R. (Stafford, Lichfield)


Hudson, R. S. (Cumberl'nd, Whiteh'n)
Radford, E. A.
Windsor-Clive, Lieut.-Colonel George


Huntingfield, Lord
Ramsden, E.
Wise, Sir Fredric


Hurd, Percy A.
Rawson, Sir Cooper
Withers, John James


Hurst, Gerald B.
Rees, Sir Beddoe
Womersley, W. J.


Hutchison,G.A.Clark (Midl'n & P'bl's)
Reid, D. D. (County Down)
Wood, E.(Chest'r, Stalyb'dge & Hyde)


lnskip, Sir Thomas Walker H.
Remer, J. R.
Worthington-Evans, Rt. Hon. Sir L.


Jackson, Sir H. (Wandsworth, Cen'l)
Rentoul, G. S.
Wragg, Herbert


James, Lieut.-Colonel Hon. Cuthbert
Rhys, Hon. C. A. U.
Young, Rt. Hon. Hilton (Norwich)


Jephcott, A. R.
Roberts, E. H. G. (Flint)



Kidd, J. (Linlithgow)
Robinson, Sir T. (Lancs., Stretford)
TELLERS FOR THE NOES.—


Kindersley, Major Guy M.
Ropner, Major L.
Captain Bowyer and Major Sir


King, Captain Henry Douglas
Russell, Alexander West (Tynemouth)
Harry Barnston.


Kinloch-Cooke, Sir Clement
Salmon, Major I.

NEW CLAUSE.—(Repeal of duty on raw films, 15 and 16 Geo. V, c. 36, s. 3 (1).)

As from the first day of August, nineteen hundred and twenty-six, the duty chargeable under Section three, Sub-section (1) of the Finance Act, 1925, upon blank films on which no picture has been impressed, known as raw film or stock, shall cease.—[Mr. Hurst.]

Brought up, and read the First time.

Mr. HURST: I beg to move, "That the Clause be read a Second time."
The object of the Clause is to liberate the raw material of the film industry from the heavy tax now imposed upon
it. The House will not misinterpret this proposal into any revolt against the McKenna Duties which constitute a master-piece of fiscal wisdom, but there is an enormous distinction between this particular duty and all the other McKenna Duties, inasmuch as all the other McKenna Duties are imposed upon fully manufactured articles and upon luxuries, whereas the raw material of the film producing industry is neither fully manufactured nor is it a luxury. It is clear that there is a great distinction between the duty imposed upon the printed film and the
duty imposed upon the plain film. Many of us would like to see a heavy duty placed upon fully-printed foreign films. Although there are cases where the films reach a high standard of taste, which people are glad to see, in the main the effect of the importation of foreign films has been to flood the country with crude productions of inferior civilisations. The raw film is quite different because, without it, there would be no film-printing industry in the country at all. I ask the House to notice how heavy is the duty on this raw material. It is quite unlike any other duty on any import into this country, because the duty on the blank film represents nearly half the ordinary selling price. The ordinary price is ˙7 of a penny. The cost of production is one-half and the duty one-third of a penny and, taking into account the cost of freight, packing and insurance, imported films can only come into this country at the very lowest—if you add the actual cost of the material and the duty—at ˙8 of a penny, whereas the selling price is ˙7 of a penny. The result is that this duty fulfils no useful purpose at all.
The first question to ask is: Does it produce revenue? In the period between the end of July of last year and the end of May this year, the total duty received on the importation of raw film, after deducting the drawback on re-exports, was just over £16,000 and this very small sum was largely due to contracts in being before the duty was imposed, and also to the fact that foreign producers are anxious as long as they can to keep an interest in the British markets. The figures are so insignificant that, from the point of view of the production of revenue, no-one can justify the duty. The second question to be asked is: does it encourage British manufacture? The answer is, "No," because with the exception of the great Kodak corporation, which supplies all the raw film produced in England there are practically no companies in England producing blank film within the meaning of the McKenna Duties. If you do find, here and there, a firm which purports to deal in blank film, you will probably find that it is controlled by the Kodak corporation. Instead of free competition you have a monopoly. Free competition in blank film brought about a reduction in the price of this material
from a l¾d. per foot to .7 of a penny. Now, there is no such competition so that the chances of reduction are negligible and the chance of an increase in the price, when the Kodak has got entire mastery and control of the market, is serious. It follows, therefore, that there is no justification whatever for it and it is subject to the objection that it is a tax on raw material. We have allowed the film printing industry to be controlled by foreign suppliers and it is a deplorable thing that the rising generation in England should grow up in an atmosphere of picture houses saturated with American melodrama. How are we to cure that? Only by the home production of films, and it is a cardinal condition precedent to the establishment of a healthy film industry, that you should have the cheapest and best possible supply of raw material. You cannot get the cheapest and best when you exclude foreign competition. So long as this duty is to be practically prohibitive, that cannot be realised, and the proposed new Clause aims at remedying that state of affairs.

Mr. GATES: I beg to second the Motion.
The Mover has already covered the ground, and there is only one further point to which I would call the attention of the Chancellor of the Exchequer. The duty as at present levied amounts to 50 per cent. on retail price. If the duty were levied under the Safeguarding of Industries Act it would be 33⅓ per cent. on the value of the goods at the port of entry or considerably less than the present duty. I submit the present charge is prohibitive and would be more fairly levied according to the rate laid down in the Safeguarding of Industries Act. I have been asked by constituents of mine who are interested in the film printing industry to support the proposed new Clause.

Mr. PETHICK-LAWRENCE: I also desire to support the proposed new Clause which seems to have every argument in common sense to commend it to the Chancellor of the Exchequer. I put it to the Chancellor, now that he has seen the working of this absurd and ridiculous tax, and has seen the injury it does to British film, he should withdraw it. The protective argument has always been in favour of taxing the manufactured article
coming into this country, in order to give a benefit to the British manufacturer. This is a raw material for the cinematograph trade, and to tax this raw material is to injure British employment in that respect. Therefore, as the case is so straightforward I hope the right hon. Gentleman will see his way to accept the proposal.

Mr. McNEILL: I quite agree that this particular duty is not on the same footing as some of those with which we have had to deal. I can agree, in this case, that it is a matter which calls for careful watching of the tax machinery of the Customs. We must see exactly how the importation proceeds, and the effect, especially the effect upon prices in this country, before we can definitely say that this is a duty which ought to be maintained. The Mover, however, seemed to leave out of account some facts bearing upon this question which ought to be taken into consideration. I do not think he is justified in what he said as to the rate of the duty. It is important to have regard to the fact that this duty formed part of the McKenna Duties which disappeared under the regime of the right hon. Gentleman the Member for Colne Valley (Mr. Snowden) in 1924. When the Chancellor of the Exchequer brought forward his Budget last year, among other McKenna Duties, this one was reinstated. It is significant that the price of the article which fell very low when the duty was removed in 1924, has not shown the smallest tendency to rise again in consequence of the reimposition of the duty, but stands at exactly the same figure of .7 of a penny at which it stood more than a year ago. The fact that it is so, and the fact that the importation is not such a negligible quantity as suggested, indicate that the hon. Member is not justified in speaking of the duty as prohibitive.
In the nine months from July of last year to the 31st March of the present year there was an importation of 8,000,000 linear feet, which is, of course, a small quantity, or rather relatively a small quantity of the amount used for the business. But it is not a quantity which can be altogether left out of account, nor can it be said that the duty upon the imported films is prohibitive. During the short period of two months, from the 1st April of the present year
to the end of May there was an importation of 3,714,000 feet, and it seems that the amount of importation has gone up, is a rising quantity, and indicates that the revenue derived from it is not entirely negligible. I am quite sure that if this Amendment were accepted the loss to the Exchequer would be £100,000, which is quite an appreciable figure. The result of the imposition of the duty, in the first instance, under the McKenna Duties was to create an industry in the making of raw film that did not exist in this country before. I entirely agree with what my hon. and learned Friend said as to the foreign and American films, and though I do not intend to develop the argument, I should be glad to see more British films in our cinemas. I do not, however, quite appreciate his argument that the free importation of foreign raw films and unprinted films is going to have a very great effect in that respect. In any case, it is important that there should be a useful industry in this country, and that we should have here the manufacture of raw films as well as printed ones, and this was the effect of the duty when it was first imposed. It brought into being the manufacture of films in this country.
If it can be shown, as suggested by my hon. and learned Friend, that there was really something in the nature of a monopoly in this matter which made the prices unnecessarily or artificially high so that the result was that there was a drag upon the film industry, I would be prepared to agree, as I have always agreed, that the matter would require careful consideration as to whether or not something should be done to prevent that monopoly. I submit, however, to the House that we have no evidence that there is any such monopoly, no evidence that the present prices are artificial or that any importation would have, really, the effect of materially reducing them. The very fact that the Kodak Company is the only company that are manufacturing films in this country seems to me to point to the fact that the price is not so artificial, nor so high as to suggest that they are removed from the competition of their own trade. I quite agree with my hon. and learned Friend in what he said, and I have already intimated so, that the circumstances of this
particular industry are such that we should certainly not throw aside the suggestion that has been put forward. We cannot accept the Amendment, but I do not see any reason that if, in the course of a few years or so, when we shall have had more experience of this trade, as we are likely to do, that if we found there was a monopoly and a decrease of competition, that we should have to deal with it. When we see the

whole of the situation the matter can be reconsidered.

Mr. HURST: In view of what the right hon. Gentleman has said, I ask the leave of the House to withdraw the proposed Clause.

HON. MEMBERS: No!
Question put, "That the Clause be read a Second time."

The House divided: Ayes, 140; Noes, 270.

Division No. 324.]
AYES.
[5.39 p.m.


Adamson, Rt. Hon. W. (Fife, West)
Grundy, T. W.
Richardson, R. (Houghton-le-Spring)


Alexander, A. V. (Sheffield, Hillsbro')
Guest, Haden (Southwark, N.)
Riley, Ben


Ammon, Charles George
Hall, F. (York, W.R., Normanton)
Robinson, Sir T. (Lancs., Stretford)


Attlee, Clement Richard
Hall, G. H. (Merthyr Tydvil)
Rose, Frank H.


Baker, J. (Wolverhampton, Bilston)
Hamilton, Sir R. (Orkney & Shetland)
Runciman, Rt. Hon. Walter


Barker, G. (Monmouth, Abertillery)
Hardie, George D.
Saklatvala, Shapurji


Barnes, A.
Harney, E. A.
Salter, Dr. Alfred


Barr, J.
Hartshorn, Rt. Hon. Vernon
Scrymgeour, E.


Batey, Joseph
Hayday, Arthur
Shepherd, Arthur Lewis


Beckett, John (Gateshead)
Henderson, Right Hon. A. (Burnley)
Shiels, Dr. Drummond


Benn, Captain Wedgwood (Leith)
Henderson, T. (Glasgow)
Short, Alfred (Wednesbury)


Bowerman, Rt. Hon. Charles W.
Hirst, G. H.
Sitch, Charles H.


Bromley, J.
Hirst, W. (Bradford, South)
Slesser, Sir Henry H.


Brown, James (Ayr and Bute)
Hore-Belisha, Leslie
Smith, Ben (Bermondsey, Rotherhithe)


Buchanan, G.
Hudson, J. H. (Huddersfield)
Smith, H. B. Lees (Keighley)


Buxton, Rt. Hon. Noel
Hutchison, Sir Robert (Montrose)
Smith, Rennie (Penistone)


Charleton, H. C.
John, William (Rhondda, West)
Snell, Harry


Clowes, S.
Johnston, Thomas (Dundee)
Snowden, Rt. Hon. Philip


Cluse, W. S.
Jones, Henry Haydn (Merioneth)
Spencer, G. A. (Broxtowe)


Clynes, Rt. Hon. John R.
Jones, Morgan (Caerphilly)
Spoor, Rt. Hon. Benjamin Charles


Collins, Sir Godfrey (Greenock)
Jones, T. I. Mardy (Pontypridd)
Stamford, T. W.


Compton, Joseph
Kelly, W. T.
Stephen, Campbell


Cove, W. G.
Kennedy, T.
Stewart, J. (St. Rollox)


Cowan, D. M. (Scottish Universities)
Kenworthy, Lt.-Com. Hon. Joseph M.
Sullivan, J.


Crawfurd, H. E.
Kenyon, Barnet
Sutton, J. E.


Dalton, Hugh
Kirkwood, D
Thorne, G. R. (Wolverhampton, E.)


Davies, Evan (Ebbw Vale)
Lawson, John James
Thurtle, E.


Davies, Rhys John (Westhoughton)
Lee, F.
Tinker, John Joseph


Day, Colonel Harry
Lindley, F. W.
Townend, A. E.


Dennison, R.
Livingstone, A. M.
Trevelyan, Rt. Hon. C. P.


Duncan, C.
Lowth, T.
Viant, S. P.


Dunnico, H,
Lunn, William
Wallhead, Richard C.


Edwards, J. Hugh (Accrington)
MacLaren, Andrew
Walsh, Rt. Hon. Stephen


England, Colonel A.
Maclean, Nell (Glasgow, Govan)
Watson, W. M. (Dunfermline)


Evans, Capt. Ernest (Welsh Univer.)
March, S.
Webb, Rt. Hon. Sidney


Fenby, T. D.
Montague, Frederick
Wedgwood, Rt. Hon. Josiah


Forrest, W.
Morrison, R. C. (Tottenham, N.)
Wheatley, Rt. Hon. J.


Garro-Jones, Captain G. M.
Murnin, H.
Wiggins, William Martin


Gardner, J. P.
Naylor, T. E.
Wilkinson, Ellen C.


Gibbins, Joseph
Oliver, George Harold
Williams, C. P. (Denbigh, Wrexham)


Gillett, George M.
Palin, John Henry
Williams, David (Swansea, East)


Gosling, Harry
Paling, W.
Williams, Dr. J. H. (Llanelly)


Graham, Rt. Hon. Wm. (Edin., Cent.)
Parkinson, John Allen (Wigan)
Williams, T. (York, Don Valley)


Greenall, T.
Pethick-Lawrence, F. W.
Wilson, R. J. (Jarrow)


Greenwood. A. (Nelson and Colne)
Ponsonby, Arthur



Grenfell, D. R. (Glamorgan)
Potts, John S.
TELLERS FOR THE AYES.—


Griffiths, T. (Monmouth, Pontypool)
Purcell, A. A.
Mr. Charles Edwards and Mr.


Groves, T.
Rees, Sir Beddoe
Hayes.


NOES.


Acland-Troyte, Lieut.-Colonel
Ashley, Lt.-Col. Rt. Hon. Wilfrid W.
Bennett, A. J.


Agg-Gardner, Rt. Hon. Sir James T.
Baldwin, Rt. Hon. Stanley
Bentinck, Lord Henry Cavendish


Ainsworth. Major Charles
Balfour, George (Hampstead)
Berry, Sir George


Albery, Irving James
Banks, Reginald Mitchell
Bethel, A.


Alexander, E. E. (Leyton)
Barclay-Harvey, C. M.
Betterton, Henry B.


Alexander, Sir Wm. (Glasgow, Cent'l)
Barnston, Major Sir Harry
Birchall, Major J. Dearman


Allen, J. Sandeman (L'pool, W. Derby)
Beamish, Captain T. P. H.
Bird, Sir R. B. (Wolverhampton, W.)


Amery, Rt. Hon. Leopold C. M. S.
Beckett, Sir Gervase (Leeds, N.)
Blades, Sir George Rowland


Apsley, Lord
Bellairs, Commander Carlyon W.
Boothby, R. J. G.


Bourne, Captain Robert Croft
Gunston, Captain D. W.
Perkins, Colonel E. K.


Bridgeman, Rt. Hon. William Clive
Hacking, Captain Douglas H.
Perring, Sir William George


Briggs, J. Harold
Hall, Lieut.-Col. Sir F. (Dulwich)
Peto, Basil E. (Devon, Barnstaple)


Briscoe, Richard George
Hall, Capt. W. D'A. (Brecon & Rad.)
Philipson, Mabel


Brittain, Sir Harry
Hammersley, S. S.
Plelou, D. P.


Brooke, Brigadier-General C. R. I.
Hanbury, C.
Pilditch, Sir Philip


Brown, Maj. D. C. (N'th'I'd., Hexham)
Hannon, Patrick Joseph Henry
Pownall, Lieut.-Colonel Sir Assheton


Buckingham, Sir H.
Harland, A.
Preston, William


Bull, Rt. Hon. Sir William James
Harmsworth, Hon. E. C. (Kent)
Price, Major C. W. M.


Bullock, Captain M.
Harrison, G. J. C.
Radford, E. A.


Burgoyne, Lieut.-Colonel Sir Alan
Hartington, Marquess of
Ramsden, E.


Burman, J. B.
Harvey, Major S. E. (Devon, Totnes)
Rawson, Sir Cooper


Burton, Colonel H. W.
Haslam, Henry C.
Reld, D. D. (Country Down)


Butler, Sir Geoffrey
Heneage, Lieut.-Col. Arthur P.
Remer, J. R.


Cadogan, Major Hon. Edward
Hennessy, Major J. R. G.
Rentoul, G. S.


Caine, Gordon Hall
Herbert, Dennis (Hertford, Watford)
Rhys, Hon. C. A. U.


Campbell, E. T.
Herbert, S.(York, N. R., Scar. & Wh'by)
Roberts, E. H. G. (Flint)


Cautley, Sir Henry S.
Hills, Major John Waller
Ropner, Major L.


Cayzer, Sir C. (Chester, City)
Hogg, Rt. Hon. Sir D.(St. Marylebone)
Russell, Alexander West (Tynemouth)


Cazalet, Captain Victor A.
Holt, Capt. H. P.
Samuel, A. M. (Surrey, Farnham)


Cecil, Rt. Hon. Sir Evelyn (Aston)
Hope, Sir Harry (Fortar)
Samuel, Samuel (W'dsworth, Putney)


Chadwick, Sir Robert Burton
Hopkins, J. W. W.
Sandeman, A. Stewart


Chamberlain, Rt. Hn. Sir J.A.(Birm.,W.)
Hopkinson, Sir A. (Eng. Universities)
Sanders, Sir Robert A.


Charteris, Brigadler-General J.
Hopkinson, A. (Lancaster, Mossley)
Scott, Sir Leslie (Liverp'l, Exchange)


Churchill, Rt. Hon. Winston Spencer
Horlick, Lieut.-Colonel J.N.
Shaw, Lt.-Col. A. D. Mcl. (Renfrew, W.)


Churchman, Sir Arthur C.
Howard, Captain Hon. Donald
Shaw, Capt. W. W. (Wilts, Westb'y)


Clarry, Reginald George
Hudson, Capt. A. U. M. (Hackney, N.)
Sheffield, Sir Berkeley


Clayton, G. C.
Hudson, R. S. (Cumberland, Whiteh'n)
Shepperson, E. W.


Cobb, Sir Cyril
Huntingfield, Lord
Simms, Dr. John M. (Co. Down)


Cockeri11, Brig.-General Sir G. K.
Hurd, Percy A.
Sinclair, Col. T. (Queen's Univ., Belfst


Colfox, Major Wm. Phillips
Huttchison, G. A. Clark (Midl'n & P'bl's)
Skelton, A. N.


Conway, Sir W. Martin
Inskip, Sir Thomas Walker H.
Slaney, Major P. Kenyon


Cooper, A. Duff
Jackson, Sir H. (Wandsworth, Cen'l
Smith-Carington, Neville W.


Cope, Major William
Jacob, A. E.
Somerville, A. A. (Windsor)


Couper, J. B.
James, Lieut.-Colonel Hon. Cuthbert
Spender-Clay, Colonel H.


Cowan, Sir Wm. Henry (Islingtn., N.)
Jephcott, A.R.
Stanley, Col Hon. G. F. (Will'sden, E.)


Cralk, Rt. Hon. Sir Henry
Kidd, J. (Linlithgow)
Stanley, Lord (Fylde)


Croft, Brigadier-General Sir H.
Kinderstey, Major G. M.
Stanley, Hon. O. F. G. (Westm'eland


Crooke, J. Smedley (Deritend)
King, Captain Henry Douglas
Steel, Major Samuel Strang


Crookshank, Col C. de W. (Berwick)
Kinloch-Cooke, Sir Clement
Stott, Lieut.-Colonel W. H.


Crookshank, Cpt. H.(Lindsey, Gainsbro)
Knox, Sir Alfred
Strickland, Sir Gerald


Cunliffe, Sir Herbert
Lane Fox, Col. Rt. Hon. George R.
Stuart, Crichton-, Lord C.


Curzon, Captain Viscount
Lister, Cunliffe-, Rt. Hon. Sir Philip
Stuart, Hon. J. (Moray and Nairn)


Dalkeith, Earl of
Locker-Lampson, G. (Wood Green)
Styles, Captain H. Walter


Dalziel, Sir Davison
Locker-Lampson, Com. O. (Handsw'th)
Sueter, Rear-Admiral Murray Fraser)


Davidson, J. (Hertf'd.Hemel Hempst'd)
Lord, Walter Greaves.
Sugden, Sir Wilfrid


Davidson, Major-General Sir J. H
Lougher, L.
Templeton, W. P.


Davies, Dr. Vernon
Lucas-Tooth, Sir Hugh Vere
Thompson, Luke (Sunderland)


Davies, Sir Thomas (Cirencester)
Luce, Major-Gen. Sir Richard Harman
Thomson, Rt. Hon. Sir. W. Mitchell-


Davison, Sir W. H. (Kensington, S.)
Lynn, Sir R. J.
Tinne, J. A.


Dawson, Sir Philip
MacAndrew, Major Charles Glen
Titchfield, Major the Marquess of


Dixey, A. C.
Macdonald, R. (Glasgow, Cathcart)
Tryon, Rt. Hon. George Clement


Drewe, C.
McLean, Major A.
Turton, Rt. Hon. George Clement


Eden, Captain Anthony
Macmillan, Captain H.
Turton, Sir Edmund Russborough


Edmondson, Major A. J.
Macnaghten, Hon. Sir Malcolm
Vaughan-Morgan, Col. K. P.


Elliot, Major Walter E.
McNeill, Rt. Hon. Ronald John
Wallace, Captain D. E.


Ellis, R. G.
Maitland, Sir Arthur D. Steel-
Warner, Brigadier-General W. W.


Erskine, Lord (Somerset, Westen-s-M )
Malone, Major P. B.
Warrender, Sir Victor


Erskine, James Malcolm Monteith
Manningham-Buller, Sir Mervyn
Watson, Sir F. (Pudsey and Otley)


Evans, Captain A. (Cardiff, South)
Margesson, Capt. D.
Watson, Rt. Hon. W. (Carlisle)


Everard, W. Lindsay
Marriott, Sir J. A. R.
Watts, Dr. T.


Falle, Sir Bertram G.
Milne, J.S. Wardlaw-
Wells, S. R.


Fanshawe, Commander G. D.
Mitchell, S. (Lanark, Lanark)
Wheler, Major Sir Granville C. H.


Fermoy, Lord
Mitchell, W. Foot (Saffron Walden)
White, Lieut.-Col. Sir G. Dairymple


Fielden, E. B.
Mond, Rt. Hon. Sir Alfred
Williams, A. M. (Cornwall, Northern)


Forestier-Walker, Sir L.
Monsell, Eyres, Com. Rt. Hon. B. M.
Williams, Com. C. (Devon, Torquay)


Foxcroft, Captain C. T.
Moore, Lieut.-Colonel T. C. R. (Ayr)
Wilson, M. J. (York, N. R., Richm'd


Frece, Sir Walter de
Moore-Brabazon, Lieut.-Col. J. T. C.
Wilson, R. R. (Stafford, Lichfield)


Fremantle, Lt.-Col. Francis E.
Morden, Col. W. Grant
Windsor-Clive, Lieut.-Colonel George


Gadie, Lieut.-Col. Anthony
Moreing, Captain A. H.
Winterton, Rt. Hon. Earl


Gault, Lieut.-Col. Andrew Hamilton
Morrison, H. (Wilts, Salisbury)
Wise, Sir Fredric


Gibbs, Col. Rt. Hon. George Abraham
Morrison-Bell, Sir Arthur Clive
Withers, John James


Glyn, Major R. G. C.
Nall, Lieut.-Colonel Sir Joseph
Wolmer, Viscount


Goff, Sir Park
Nelson, Sir Frank
Womersley, W. J.


Gower, Sir Robert
Neville, R. J.
Wood, E. (Chest'r, Stalyb'ge & Hyde)


Grace, John
Newman, Sir R. H. S. D. L. (Exeter)
Wood, Sir H. K. (Woolwich, West)


Grant, Sir J. A.
Nicholson, Col. Rt. Hn. W. G.(Ptrst'ld.)
Worthington-Evans, Rt. Hon. Sir L.


Grattan-Doyle, Sir N.
Nuttall, Ellis
Wragg, Herbert


Greene, W. P. Crawford
O'Neill Major Rt. Hon. Hugh
Young, Rt. Hon. Hilton (Norwich)


Gretton, Colonel Rt. Hon. John
Oman, Sir Charles William C.



Grotrian, H. Brent
Penny, Frederick George
TELLERS FOR THE NOES.—


Guinness, Rt. Hon. Walter E.
Percy, Lord Eustace (Hastings)
Mr. F. c. Thomson and Captain




Bowyer.

NEW CLAUSE.—(Exemption in certain cases for income applied to educational purposes.)

"Any university and any college or hall in any university of the United Kingdom and any public school and any educational institution receiving a Government grant shall be exempt from Income Tax in respect of any profits or gains forming part of the income of such university, college, hall, public school, or educational institution which are applicable to educational purposes only so far as the same are applied to educational purposes only."—[Mr. Withers.]

Brought up, and read the First time.

Mr. WITHERS: I beg to move, "That the Clause be read a Second time."
This proposed new Clause was discussed at considerable length in Committee, and it has only been put down on the Report stage to enable us to ask the Chancellor of the Exchequer whether he has very kindly, as he indicated he would, considered the question. He spoke very sympathetically, and I understood him to say that between the Committee and the Report stages he would see how far he could open the door to admit these cases without allowing everybody to come rushing in. The matter is causing a very great deal of anxiety, and I hope the Chancellor of the Exchequer will be able to tell us something.

Mr. CHURCHILL: The House will remember that we had a very long discussion on this subject in Committee, when I unfolded all the arguments on the question which occurred to me; and I am bound to say that I felt that the adverse arguments which I raised were adequate and solid and justified us in declining to accept the Amendment which had been moved. I do not want to repeat all those arguments, because I should come under the ban of the hon. and gallant Member who is sitting below the Gangway, although I must say, parenthetically, that when identically the same point is raised and identically the same arguments are put forward it is very difficult to make an entirely different speech in exactly the same sense. If the answer is to be "No" and it has been given on one occasion in the monosyllabic form of "No," it is difficult to give the same answer on the next occasion without being accused of repetition. I suggested in Committee that the act of opening the door and making exceptions piecemeal
and sporadically to the admittedly arbitrary limits which are all we have at present governing the application of the principles of exemption of charitable institutions from Income Tax would be fraught with great dangers, and that we might easily be led on from point to point until a serious loss to the revenue had resulted and all principle in the division of taxable from non-taxable had been completely lost.
I said it would be much better for us to endeavour, not between the Committee stage and the Report stage, for that would be too short an interval, but between this Budget and the next, to see whether it is not possible to draw the line which gives charitable exemption with some greater regard to all the actual circumstances that exist. It is admittedly a line which causes anomalies in many cases. Its application in this case, for instance, divides most vehemently the right hon. Member for Central Newcastle (Mr. Trevelyan) from the right hon. Gentleman the Member for Central Edinburgh (Mr. W. Graham), the late Financial Secretary to the Treasury, although while holding diametrically opposite views, they both approached the subject, as everyone would believe, from the very highest plane of virtue. But if there is opportunity in the course of the autumn and winter I may find it possible to re-define the limits of charitable exemption, not necessarily in every case in the direction of laxity and indulgence; and possibly a more logical and more satisfactory and water-tight scheme may be devised which, while giving relief, at the same time will not necessarily react injuriously upon the revenue. There may be something to be said on both sides—that some are now out who ought to be in, and some who are now in ought to be out; but that cannot be decided at the present time, and I must clearly state that I cannot undertake to give a definite pledge to alter the present rules. All I say is that they shall be carefully examined in order to ascertain whether a better line can be drawn. That I undertake to do; but I can give no pledge that I shall succeed.
In the meanwhile, what is the position and where is the real hardship? As the House knows, if the Brighton College case had not been raised and carried to the highest Court and there decided against the college, it is possible that
in a certain number of cases which were believed by the Inland Revenue to be beyond the scope of the law, there would not have been this year, or in future years, a demand made for Income Tax. Now that the matter has been given this great prominence and publicity, and that the whole of the Inland Revenue staff are apprised of the latest and clearest definition of the law, as laid down by the highest authority, it is undoubted that in a certain number of cases where there have been no demands for taxation in the past there will be demands for taxation in the future. It is impossible for me to intervene in that respect other than by an alteration of the law. I could not, for instance, take up the absurd position of saying that those who had paid taxes in the past will have to go on paying them in the future, while those who, owing to a perfectly honest interpretation of the law, have not paid them in the past, will not be called upon to pay at any future time.
Therefore I am afraid the hardship of a certain number of institutions which have not hitherto been taxed, but which will in future have to pay the tax, must remain; but I think it would be going beyond what is equitable and fair to go back into the past and make the new interpretation of the law rule retrospectively. For instance, an institution which has not hitherto been asked to pay the tax and which is in every way a charitable institution may now, owing to this question having been raised, be called upon to pay; but if it were called on not merely to pay tax in the future but to pay arrears in the past, for, certainly, three years, I think it would be a hardship, and one which might in particular cases fall with injurious and damaging weight upon particular institutions. I have consulted with the Inland Revenue upon the subject, and I am advised that it would be possible for us, within the very narrow limits that are open to the Treasury in the execution and administration of the law, to do this much. I should explain that we are governed by the law, and the Auditor-General is bound to draw the attention of the Public Accounts Committee to any deviation, however small, which is made in this administration, even if it be a deviation which would command the general assent of Parliament, but I am
advised that I shall not be trespassing beyond that very restricted limit of choice given if I make an announcement and give directions as follows. This is the text of the announcement which I propose to make, and which I now make:
In the case of an educational charity which is admitted to be a charity for Income Tax purposes, and in whose case, as regards all years prior to 1924–25, non-liability in respect of any profits arising from the surplus of fees over working expenses has been expressly or tacitly admitted by the Income Tax Commissioners concerned, it will not now be sought by the Inland Revenue to re-open or raise for the first time the question of Income Tax liability in respect of such profits for any year prior to the year 1924–25.
I think that is a fair way of dealing with the matter. At any rate, it is the most I can do.

Mr. WILLIAM GRAHAM: The Chancellor of the Exchequer has made on this subject what will be to all students of Income Tax a very interesting statement. There is no desire on our part to recall the discussion which took place on a previous occasion, but the narrow point before the Committee was whether the surplus in the case of Brighton College was something analogous to business profit and therefore taxable material. Whatever view we take of the exemption of charity the House is bound for the time being, and so far as this discussion is concerned, by the decision of the highest Court in the Brighton College case. That is the effective interpretation of law on this subject until the law is changed. The Chancellor of the Exchequer now proposes to take that case, as he must, as the basis for the assessment of Income Tax of these surpluses as they emerge following that decision.
6.0 P.M.
The right hon. Gentleman proposes not to go back in the case of colleges of education and institutions prior to that decision. I think that the Chancellor of the Exchequer and the Financial Secretary will agree that in so far as these past assessments are final and conclusive they probably could not be re-opened in any case, and accordingly any steps of a retrospective character could only apply to those which are still open and not fixed or finally settled, and which would get the benefit of what the Chancellor of the Exchequer now proposes. It is perfectly true that this question has divided
hon. Gentlemen on this side of the House, but may I say at once to those who differ from me that we shall make them a present this afternoon, if we may, of the retrospective concession which the Chancellor of the Exchequer suggests, but it should be remembered that the law, as laid down, is to be enforced until we can undertake this review of the whole question and, as the Royal Commission suggests, arrive at some sensible and practical proposal.

Mr. DENNIS HERBERT: I realise the way in which the Chancellor of the Exchequer sympathises with this claim, but I would like to ask him whether he would try to get his advisers to consider whether the suggested assessment in these cases are made quite as fairly as they ought to be at the present time. I made the point during the Committee stage that these profits were earned only by reason of those institutions possessing large buildings and valuable properties which, in the case of a commercial undertaking, would have been provided by the subscribed capital. I want to ask the right hon. Gentleman whether he will consider the question of allowing these institutions to bring into account for the purpose of this assessment a certain rate of interest on the capital value.

Mr. CHURCHILL: I will consider that point.

Mr. TREVELYAN: I do not know, and I wish the right hon. Gentleman could give us a little more indication, as to what the complete effect of the new interpretation of the law is going to be. It seems to me that a very considerable threat is put forward for the future in regard to these educational institutions, and I ask the Chancellor whether between now and next year, when this matter will undoubtedly come up again, he will obtain information with regard to the number of institutions affected by the law as it stands at present. It is clear that a great many important schools, and, as I pointed out, the right hon. Gentleman's own schools, are going to be adversely affected by the law as it stands before the House comes to discuss this matter again next year. I think we ought to be put in the position of knowing what educational institutions are affected, and how far they are adversely affected. We are afraid that a great many of them
are going to be very seriously affected, and if so the House would be in a better position to support the Clause moved by my hon. Friend.

Mr. RUNCIMAN: In reply to a question during Question Time the Chancellor of the Exchequer said "No, Sir," when he really meant "Yes, Sir." Now he says "No, Sir" quite clearly and he means "No." The concession which the right hon. Gentleman has made this afternoon is one which strict observers of the Income Tax like the right hon. Gentleman the Member for Central Edinburgh (Mr. Graham) might very well examine more carefully. I am not quite clear under what powers the Chancellor of the Exchequer claims the right to say to an individual taxpayer, who under the recent decision is held liable for Income Tax, that he will not be assessed for Income Tax. Surely it is a serious departure from the ordinary practice that the Chancellor of the Exchequer may, of his own free will, power and selection, say that any individual taxpayer may be free from assessment, and free from this tax when he has no legislative authority for so doing. I submit this is a very dangerous precedent. If the right hon. Gentleman really wishes to relieve these institutions, as I am sure the whole House does, of charges which they are quite unable to pay, the proper thing to do is for the right hon. Gentleman to propose a new Clause relieving them from liability. I think that was the course the right hon. Gentleman ought to have adopted. What the right hon. Gentleman says really amounts to this, that he will consider the case and display his usual courtesy with his hon. Friends and Members of the Opposition interested in universities and colleges, although it may be that at the end of it all he may form one view or the other.
The right hon. Gentleman has made no promise that is worth anything whatever, and those who look at the question purely from the point of view of these educational institutions have nothing to thank the right hon. Gentleman for at the present time, except that he has promised to be very polite to them for the remainder of the calendar year, and I suppose we must be very grateful to him for that promise. This promise will not help the right hon. Gentleman's own school or other institutions, because he
has promised absolutely nothing, and he is taking a step in regard to granting exemptions which is a very dangerous precedent. I suggest that even now the best thing for him to do is to re-commit this Bill, and bring in a Clause of his own drafting, and send a short Minute to the Inland Revenue granting exemption to these institutions who, by the Courts of Law, are now known to be liable. I hope a very strict observer of the law, like the right hon. Gentleman the Member for Central Edinburgh, will reconsider his decision, and not be so ready to fail in with the Chancellor of the Exchequer when he strays from the path of rectitude.

Mr. SOMERVILLE: The Chancellor of the Exchequer has admitted that the levying of Income Tax on these profits is a new tax. A large number of secondary schools are concerned, and many of them have been hardly hit by what is practically a new tax. For these reasons I ask the right hon. Gentleman to make his promised inquiry very fully, find out the conditions of those schools, and how this new tax will affect them. The Chancellor of the Exchequer has not told us yet how much this tax on surplus profits has brought in during past years. I hope that schools which have to pay off debt on buildings or land will be carefully taken into account in assessing the Income Tax.

Mr. HADEN GUEST: I want to suggest that there is a distinct dividing line between charity in general and educational charities. An educational charity is quite a different thing, and we should draw a clear line between money spent for the benefit of the rising generation and money spent for ordinary charitable purposes. I am driven to this line of argument by the view put forward by the right hon. Gentleman the Member for Central Edinburgh, who takes rather a purist view of this matter, and I quite realise the danger of having an overwhelming demand made which cannot be granted. If the principle is set up that money which is spent for the advantage of child life is not to be subject to the tax in the same way as other charitable expenditure, you would have there a perfectly clear line of division. I suggest that that would be strictly in line with
other provisions in regard to the Income Tax at the present time. Exemption is already given in certain cases where there are children attending secondary schools, and that seems to be strictly in line with the cleavage I am suggesting. I hope the Chancellor of the Exchequer will make a cleavage on those lines next year.

Commander WILLIAMS: I was very much interested in the attempt made by the right hon. Gentleman below the Gangway (Mr. Runciman) to try to bring himself into line with the people who hold that under this Amendment we are going rather beyond our powers in regard to finance in this House. The right hon. Gentleman took the point of view of refusing to grant this new Clause in which I most thoroughly agree with him, in fact I think I was the only hon. Member on this side of the House who urged him not to accept it the other day. The hon. Gentleman below the Gangway pointed out that it is a very dangerous thing for the Chancellor of the Exchequer to come down here and say, as he said to-day, that there were a large number of people who up to now were liable for this tax but who, quite innocently and by luck, have not had to pay. It is almost impossible for the Chancellor of the Exchequer to assess those people.
Supposing we have a reverse and another Chancellor of the Exchequer comes into office. There is nothing to prevent him going back and extracting the money from those institutions. I do think that, in all the circumstances of the present time, it would be grossly unfair to these institutions to put them in a position in which they are not certain whether they may or may not have to make payments to cover exemptions in the past. I entirely agree with the Chancellor of the Exchequer on that point, and I do not think the occasion is one on which the law should be driven hard and bitterly so as to extract the last farthing from the taxpayer. I should like, however, to add my opinion that, in the case of all these charitable institutions, at a time when taxation in every other line of life is being tightened up, when the burden is being made more and more heavy, and when there is a tendency to widen, naturally and rightly, the extent of the charges made on these cheritable institutions, it is absolutely
essential and necessary that we should have a clearly defined line indicating where charitable institutions begin and where they end. That has been the point of view of a good many speakers this afternoon, and I hope that within the next 12 months that line will be made clear and definite, so that we may know absolutely where we are in this respect.

Mr. WITHERS: In view of what has been said by the Chancellor of the Exchequer, may I ask the leave of the House to withdraw the Clause?

HON. MEMBERS: No!

Mr. W. GRAHAM: On the suggestion that the Clause be withdrawn, I should, with the permission of the House, like to ask the Chancellor of the Exchequer a question on one point which emerges from the speech of my right hon. Friend the Member for West Swansea (Mr. Runciman). As regards those past assessments which are closed and final, I think it must be clear that, under the Income Tax law, they are beyond challenge and are protected; but there is a class of assessments, as applied to these educational institutions and colleges prior to 1924–25, which may not yet be fixed and determined, and presumably it is to that class that the Chancellor of the Exchequer proposes to apply the concession he has made this afternoon. I think we are bound to point out, and here I support the right hon. Gentleman very strongly, that now it has been determined, under the Brighton College case, that that is the law of the land, the proposal of the Chancellor of the Exchequer, if it were made applicable to these still undetermined assessments, would not be in order, and I cannot imagine the Comptroller and Auditor-General or the Public Accounts Committee of this House approving of anything which, at the date when the law was determined, was not strict application of the law. I do not think the Chancellor of the Exchequer has cleared up that point, and I apologise to the House for not putting it when I spoke before on this matter in Committee.

Captain BENN: I must congratulate the hon. Member for Cambridge University (Mr. Withers) once again on his
submission to the whim of the Government. I never saw Members of this House so readily or touchingly submissive. They introduce an Amendment which was much talked of in the Press; they bring the Noble Lord the Member for Oxford University (Lord H. Cecil), one of the senior and most distinguished Members of this House, to make an admirable case; but they get nothing from the Chancellor of the Exchequer, and then, at the first time of asking, they ask leave to withdraw, in view of a concession which he promised. On the Report stage, the representatives of the same seats of learning come forward again. The Chancellor tells the House he can make no pledge, but that somehow, at some time, somewhere, he will consider it. That is all he says, and then the hon. Gentleman rises again and says that, in view of the generous way in which his case has been met, he again proposes to withdraw. I do not think it is an argument in favour of university representation.
I was expecting, and still expect, the Chancellor of the Exchequer to tell us whether he is satisfied that he has legal authority to remit taxes to certain people. It is a very important point, and I would suggest that, if there be the least doubt as to whether this legal authority exists, we should, inasmuch as we are considering the Finance Bill, put the necessary authority into the Bill. No one can complain of that, and it would put the whole matter beyond doubt. As has been pointed out by two ex-Financial Secretaries to the Treasury. it is a dangerous thing to remit taxation by administrative action. The Chancellor of the Exchequer seems to have satisfied himself that he has the power. If he has the statutory power, it may be otiose to put anything in now, but, if not, I would certainly suggest that the necessary steps should be taken to put a Clause in the Bill remitting for the last three years, or whatever the period may be, the taxation in these particular cases. I strongly urge the Chancellor of the Exchequer, on the ground of Parliamentary propriety and of justice to all taxpayers alike, either to state that he is satisfied that he has the necessary authority or to propose a new Clause.

Sir HENRY CRAIK: The question which we are now discussing, and which, after all, is not a large one, has strayed
into strange directions, such as the vast constitutional power of dispensing with taxation which his opponents seem to accuse the Chancellor of the Exchequer of claiming for himself. The particular question that is now before us seems to me to have assumed exaggerated dimensions in the eyes of some of my hon. Friends with whom I am usually glad to act. It will be seen that my name is not down as supporting the Amendment, and that is because, however interested I am in education, I do not think the Amendment is either well-timed or calculated to do good to the interests of education. I have long known about the Brighton judgment, and I think it affects only a comparatively small number of schools. Everyone knows that there is an enormous number of schools which are conducted for private profit. In some of these the profits are very large, and they ought to pay taxes like anyone else. In other cases, although the profits are almost nothing, yet they are conducted as companies, and are technically liable to tax. If they wish to escape taxation, they can surrender their rights as shareholders, and carry out a purely charitable work. I received myself the other day an offer, I think at an enhanced price, of one or two shares in such a joint stock school. I have forgotten whether I received any interest, but if I did I see no reason why I should not pay on it. I differ from my friends, thinking that they are calling out "Wolf!' under the influence of imaginary fears. None of the real charitable schools, which are doing a great charitable work, will be hurt by matters being allowed to go on for a year on two as they now are. I entirely dissent from the rodomontade of the right hon. Gentleman the Member for East Edinburgh (Mr. W. Graham) about the parricidal wickedness of the Chancellor of the Exchequer in robbing Harrow School, to which he owes the development of his genius. I believe Harrow is as secure as ever it was. If the coming year shows that it is threatened, then let us move.

Mr. WELLS: We have had a very small concession from the Chancellor of the Exchequer, and I think he has shown wisdom in making it, for it is quite possible that it would cost more to collect
the tax in these cases than it would bring in. I think this tax would hamper and restrict the governors of endowed schools, and would also add further to their expenses of administration. For instance, their auditors would have to prepare accounts for the Inspector of Taxes, and would have to appear before the Inspector of Taxes and argue them, for doing which they would charge the governors. I should like also to support my hon. Friend the Member for Windsor (Mr. Somerville) in asking the Chancellor of the Exchequer to give special consideration to those charges that have been paid out of income in the past for loans which have been raised by these different schools, and which are now being paid off.

Sir ROBERT HAMILTON: I desire to add a word or two in support of the point that has been raised by my right hon. Friend the Member for West Swansea (Mr. Runciman), and which has been referred to by one or two other hon. Members, namely, the dispensing powers which the Chancellor of the Exchequer claims for himself in regard to schools which come under the judgment in the case of Brighton School. It was with great astonishment that I listened to the letter which the Chancellor of the Exchequer read out, when I found that he, as Chancellor of the Exchequer, was directing a letter to his officers to say that they were not to collect taxes which were due. Surely, the position is most peculiar. I was expecting to hear that the Chancellor of the Exchequer was going to propose a new Clause in the Bill which would get over the difficulty, but all that he did was to read a letter of instructions to his officers to say that they should not collect taxes which are due. I should like to know by what right the Chancellor of the Exchequer claims this dispensing power. Surely, if the law says that these taxes are due, he should be the first person to see that they are collected. If he does not wish to collect them, I suggest that the only possible course he can take is to alter the law by adding a Clause to the Bill which is now before the House.

Mr. CHURCHILL: I can only speak again by the leave of the House, and what I say shall be very brief. I must, in the first place, draw the attention of my hon. Friends on this side of the
House to the concession they received. My right hon. Friend the Member for West Swansea (Mr. Runciman) and the hon. and gallant Member for Leith (Captain W. Benn), while expressing extreme sympathy for the cause of education, would seem to me to be content to leave these institutions exposed in every respect to the unmitigated wind of retrospective taxation.

Mr. RUNCIMAN: No; we proposed a new Clause.

Mr. CHURCHILL: On this particular point I have not, of course, acted without taking careful counsel with those who are especially conversant with these matters, and I am advised that I am not acting in arty improper or unusual or unconstitutional way, within these very narrow limits, in making the declaration which I have made. Of course, however, if I should be found to be wrong, the machinery exists by which I can be called to account, because the Comptroller and Auditor-General would report the matter to the Public Accounts Committee, and the matter would have to be argued there. So there is an effective procedure which will enable this matter to be tested in the probable event, as I expect, of it being found that I have exceeded the administrative restrictions which in certain cases are necessarily imposed upon the holder of this office. In these circumstances I think it will be in the general interest, and in the interest of the progress of our business, if the House would come to a decision upon the new Clause and support the Government in their resistance to it.

Mr. ERNEST EVANS: I do not think the House will be satisfied with the right hon. Gentleman's statement. I have certainly supported the Clause in every way I could, but I am a little alarmed at what has happened in regard to the matter. The right hon. Gentleman has told us he has not acted without consultation with experienced people. I do not imagine he would act without taking very careful advice, but it is one thing to have the advice of an official and a very different thing to have authority. The officials of the Treasury, I know, are most able and experienced men, but even they can make mistakes, and it is little consolation to us, and to education authorities, to be told that the year after next, when the Accountant-General makes his Report, it may be that this so-called concession the Chancellor is making to-day will prove to be nugatory, and we shall then be dependent on whatever Government may be in power to put right a thing which ex hypothesi is wrong. I should like to ask, is this authority based upon any Statute? Can the right hon. Gentleman point to any Statute, or anything else save the opinion of an unnamed official or officials, which justifies him in saying he has this power to say to a particular class of taxpayers, "Although the highest Court in the land has recently decided that you are liable to pay Income Tax on a certain fund, I say you need not pay it?"

Question put, "That the Clause be read a Second time."

The House divided: Ayes, 142; Noes, 244.

Orders of the Day — CLAUSE 1.—(Duty on Tea.)

Mr. CHARLETON: I beg to move to leave out the Clause.
This is a somewhat hardy annual, but I am proud to carry on in some small degree an agitation which has been going on for about 50 years for a free breakfast table. Governments have been elected on that cry, and Government after Government has failed to do anything in that direction. The country once rang with a programme drawn up on the banks of the Tyne, but that pro-
gramme is now in the cemetery along with many other things. I have spoken on the deletion of this Clause several times, and I will try to resist a desire to follow the rather bad example of the Chancellor of the Exchequer and transgress the rules of order. I will try to emulate him in his later speeches, when he was heroic enough to resist that tendency. The world will never know the struggle which went on in his breast at that time. I have pleaded for the poor, the widow and the orphan, the railwaymen and the helpless. Some friends of mine on both sides of the House have said that so far as the railwaymen are concerned I have proved too much; that I have proved that the railways are run on tea. I do not suggest that for a moment, because if I did I should get shoals of letters from Burton-on-Trent trying to prove the opposite. So far As the duty on tea is concerned, I think it bears heavily on the poor for two reasons. The first is that the grocer and middleman both want a profit on the duty they pay, and, secondly, that the very poor who have to buy the cheapest tea, and who use rather large quantities, have to pay equally with the rich persons who can buy the very best tea. It is not so fair to the poor as if there was an ad valorem duty. I have already told the House how I went to the late Lord Rhondda, who was Food Controller during the War in, what was called, the Business Government. We have no business Government now, and the Front bench is full of people who destroyed that business Government. I think they might learn something from that capable and high-souled business man. When I put the case before him for more tea for the railwaymen, the engineers, the firemen, the stokers, he asked me a few questions and then said, "Oh yes, I see, you shall have the tea." I think this Government might do worse than follow the example of that brilliant member of their party. I do not expect they will rise to his heights, but they might do their best, humbly, to learn from one of their great men, of the past.
I am moving the deletion of this Clause because I am opposed to the economic tendencies and teachings of this Government. The Chancellor of the Exchequer in some of his speeches has referred to broadening the basis of taxation. That might sound very well
to people who attend the Philip Stott College, but it will not pass muster with students of elementary economics attending tutorial classes. We do not want to broaden the basis of taxation. We want to narrow it, as far as the working-class people are concerned. Broadening the basis of taxation is a high-sounding phrase to people who do not understand economy, but it really means adding to the burdens of the poor and relieving the rich. A little while ago I heard a Conservative speaker pleading that employers should be allowed to make large profits in order to provide workmen with work. Exactly the opposite is what I want to do, and it is one of the reasons why I am moving the deletion of this Clause. I want to increase the purchasing power of the worker everywhere. The large profits which are made are not used for providing work.
Capital is not used for providing work; it is largely exported abroad, and enters into competition with our industries at home. The cities of the country are filled with factories that are decaying. The mining crisis is an illustration. We are suffering from the fact that the poor have no purchasing power. This taxation exaggerates it. The Chancellor of the Exchequer cannot say that there is not enough new capital being provided every year. If he does, I would like to know how much he wants. During last year £320,250,000 new capital was raised, of which £90,000,000 went to the Dominions and foreign countries. If that is not enough, then I should like to know how much they want. But the capital, much of it, goes abroad to produce instruments of production which compete with our own industries. It does not go to make the poor happier. The party opposite succeeded in the last election in impressing the country, although I know the "Red" letter had much to with it. John Stuart Mill summed up the subject very well—and he was not a Bolshevist—when he said:
Wherever there is an ascendant class, a large portion of the morality of the country emanates from their class interests and its feeling of class superiority.
I cannot help feeling that the economics of the party opposite are dominated by their class interest, and that is why I think they are wrong. The Chancellor of the Exchequer chided the last Chancellor with having remitted taxation,
which he carried over, but he did not mention that he remitted taxation on the rich, which also he has to bear this year. I wonder whether in the light of the results of the elections at East Ham and Hammersmith he does not think it is time to relent a little and give the poor consumer some encouragement, and I would ask whether he could not bring just a sparrow to place on the altar as a propitiation for his past sins. I am not asking very much, but I am asking that he shall help the poor, which I believe is the best direction in which the trade of the country can be improved.

Mr. BARKER: I beg to second the Amendment.
This Clause proposes to continue the tax upon tea, which is at present 4d. per lb., and the Chancellor of the Exchequer expects to raise by this tax this year £5,850,000. He taunted the Labour party with asking him to do something which they had themselves refused to do, but I should like to remind him that during 1924 the Labour Government reduced the taxation on tea by 4d. a lb. Reference has been made to the incidence of this tax. Tea at 1s. 8d. per lb. has to bear a tax of 4d., and high class tea up to 10s. a lb. bears the same tax. In the one case the tax is 20 per cent. on the poor man's tea, and in the other case it is only 3⅓ per cent. on the rich man's tea. Therefore, it strikes very hardly against the poor man. This tax is a very oppressive tax, because it falls upon the very poorest of the community. The old age pensioner, the unemployed man, out of his miserable 18s. a week, the widow, the ex-service man, on his wretched pension—all have to pay their quota of this tax, and, as a matter of fact, there is no one too poor to be further impoverished by this tax, which is, I think, the meanest tax that we have in the Budget. It should be the aim of every Government to take this tax off tea. Tea is an article of consumption used by the entire population, and it is a harmless beverage that gives a great deal of comfort to our people. The Chancellor has been aspiring for a long time to reduce the cost of living. Here he has a very golden opportunity, and I invite him to embrace this opportunity and to complete the very good work that was commenced
by the Labour Government in this respect. I am certain that he would have the gratitude of the very poorest people of this country if he would rise to the occasion and agree to the deletion of this Clause.

Mr. CHURCHILL: I am afraid it is quite impossible for me to contemplate the deletion of this Clause this year. I have already dealt with this matter on the Committee stage, when I took occasion to express a good deal of sympathy with the cause which those who have moved this Amendment have at heart, and I look forward to the day when it may be possible to do something in this direction, but, obviously, the position of the revenue now is not such as would enable us to take action such as is here proposed. After all, the tax must be lighter now than it was even before the War. [An HON. MEMBER: "Owing to the Labour Government!"] Not only so, because reductions were made in the Conservative or rather Coalition Administration, which were further exercised and developed by the right hon. Gentleman opposite, and so, as a result of the attention that has been given to this question, the tax is now actually less in burden, including the preference, than it was before the Great War. That, anyhow, is something. After all, the general rate of the burden of taxation is enormously higher, and in this sphere there is a positive reduction. At a time when every form of taxation has been doubled, trebled, and in some cases quadrupled, the burden on tea has been actually reduced, and the working classes and the poorest people of the country have emerged from the ordeal of the Great War with actually more lightly taxed tea than when they entered it. I never like to say that it is right to fix hard and definite limits to progress or rigidly to curtail the frontiers of hope, but, at the same time, I am not in a position at the present moment to accept this Amendment, and I must ask the House to endorse the very decided opinion expressed by the Committee and maintain the Tea Duty at its present rate.

Mr. A. V. ALEXANDER: It seems rather a shame that the Chancellor of the Exchequer is unable to give us the relief asked for in this Amendment. I cannot say he has rejected the appeals
that we have made with anything like enthusiasm, and I can only suggest that after all, as I said on a previous occasion, he is still hankering after those better days of his when he stood so manfully, at least on the platform, for a free breakfast table for the people. He has said to-night, however, one or two things that need to be answered. He has said, first of all, that the actual duty imposed upon tea is less now than pre-War. It is true that the total duty upon tea before the War was 4d. in the lb. and that since the queer antics of the Coalition Government in giving an Imperial preference on 90 per cent. of the tea which is imported from the Empire there has been a slight reduction in the revenue to the Treasury. On that a charge of 3⅓d. is made, but the right hon. Gentleman knows, I am quite sure, from his advisers, that whether the Tea Duty has been manipulated upwards or downwards for the purposes of the Revenue, the actual practice of the trade has always been found to follow the flat rate of duty. When my right hon. Friend the Member for Colne Valley (Mr. Snowden) took 4d. off the flat rate in 1924, the trade immediately reduced the price of tea by the full 4d., and as long as a duty of 4d., flat rate, with a preference of two-thirds of a penny, remains in effect, the consumer pays 4d. on each pound of tea, although the Treasury only receives on 90 per cent. of the product 3⅓d., so that the argument that the Tea Duty is less now than before the War is a little weaker than the arguments that we are used to hearing from the Chancellor of the Exchequer.
The right hon. Gentleman has altogether failed to apprehend the point which was so ably made by the hon. Member for South Leeds (Mr. Charleton), because he spoke about the general conditions of the working classes. The fact is that the whole tendency has been to increase the burden upon these necessities of the consumers in this country. Let me remind the right hon. Gentleman that the Sugar Duty to-day, even after the very large reductions which were made by the Labour Chancellor of the Exchequer, is nearly five times the amount of the Sugar Duty before the War. How very little consolation, therefore, it is to tell the working classes that the Tea Duty is round about the same as it was pre-War. A larger point is this, that in the case of
great numbers of the working classes, although they may have in currency figures higher wages than they received, before the War, their purchasing power is considerably less. You could not get a more striking example of that than is to be found among the miners, whose purchasing power is far less than it was before the War, and in these two main necessities of the working classes, the present position is that, taking the tax on the two articles, combined with a reduced purchasing power, they have a far higher tax to pay. That is quite unfair, in our judgment, and we do not think the Chancellor of the Exchequer has met that general argument at all in his reply to-night. Before I sit down, may I express the hope that the frontiers of hope, about which he spoke, are not so far away as he seemed to suppose? May we urge the right hon. Gentleman to go back to the study of those speeches with which he once enlightened the minds of the people and of which he was so proud that he committed them to books like "The People's Rights," and so on, and to move towards a more favourable consideration of the needs of those people whose cause he once championed but which he has long since deserted.

Mr. WALLHEAD: The Chancellor of the Exchequer has spoken about the frontiers of hope, but the frontiers of hope, with a Conservative Chancellor of the Exchequer, are more in the nature of a mirage which seems to be constantly changing its colour and receding further the more one advances. I hold that indirect taxation is making the mass of the people pay more than you could otherwise get them to pay. Direct taxation would show them too clearly the nature of taxation and what they were really paying. I hold that the poorer a man is, the more he pays, in proportion to his income, in taxation and rates. It is the old trick. I quote from memory, but I believe it was a Conservative Chancellor of the Exchequer, Sir Robert Peel, when he was discussing the question of direct versus indirect taxation, who said that there was a far better way of taxing the poor than taxing them directly; there was a method by which you could tax every rag on their backs and every bite in their mouths and they would not know how the trick was being done. That has been continued from Peel's day. Poor-people drink far more tea than rich people,
and in so far as they consume more, they pay far more taxation. The worse the tea, which the poor people drink the more is the tax in proportion to its value. The wealthy person who drinks tea once or twice a day, and gets the best quality, is paying a tax, in proportion to the value of the tea, of something like 10 per cent.; but, when the quality is poorer and the price cheaper the tax still remains the same and the proportion that is paid rises to as much as 25 per cent. It seems, surely, an unjust method of apportioning taxation, and I am in favour of direct taxation because I want the people to understand exactly what they are paying. If the Chancellor of the Exchequer says he cannot find the means of raising this £5,800,000, is he prepared to consider the wiping out of this Clause if we on these benches suggest another method of raising the money? If he will do that, we will move the Adjournment of the House in order to consider the kind of proposition we should put before him. We on these benches hold that there are fairer methods of raising this taxation than the means he proposes. If he accepts my suggestion we will get to business. He will gain encomiums for himself and he will go down in history as a really daring person, one who will be daring in the cause of peace, although hitherto he has extended more in the other direction. But this will be a final crown of laurels for him.

Mr. SCRYMGEOUR: I recognise the difficulties that confront the Chancellor of the Exchequer, but it is necessary that those representing industrial constituencies should emphasise the strength of the case that is represented in this Amendment. The very poorest people are, unfortunately, by the conditions of their vocations, addicted to tea drinking to such an extent that in many cases it becomes breakfast, dinner, tea and supper. This tax rests upon them as an unjust burden in proportion to what is paid by those in far better circumstances who do not indulge in tea to the same extent. The Chancellor of the Exchequer has been referred to as a daring person, and no one will gainsay that; and, when he is contemplating the frontiers of hope, may we not anticipate that, in the light of other days, he is
contemplating facing the whole of this question of indirect taxation? It is not only the question of tea. In my view the majority of working people are swindled in indirect taxation. If we go to the old parochial taxes we find that the phraseology employed was that a man should be taxed according to his means and substance; but we have gone away from that stage, which was a perfectly fair basis. What we mean to get at is a free breakfast table, and the Chancellor of the Exchequer had that table before him in his earlier days. Now, under his particular restrictions, he may have additional difficulties, but, it is worthy of his serious consideration to tackle not only the question of tea, but the whole question of the injustice perpetrated on the great body of the people by indirect taxation.

Mr. GROVES: I think the Chancellor of the Exchequer should accept this Amendment and do something which will be heralded by the great mass of the working people of this country as an admirable thing. I represent a great industrial constituency, and anything we can say or do here that could remove indirect taxation is a step in the right direction. I have always been a firm believer in a free breakfast table, and I sincerely believe that if the Chancellor of the Exchequer could give his serious attention to the repeal of the tea duties, he would confer a boon on the poorer people of this country. Without throwing any unnecessary bouquets at the Labour Government of 1924, I will say that one of the best features of their work, as carried out by the then Chancellor of the Exchequer, was the reduction of the tea duty. I well remember that in the tea shops we saw tea labelled, "1924 tea 4d. per lb. reduction." Apart from any facetious remarks in regard to the Conservative Government, the present Chancellor of the Exchequer has certainly in the past 20 years led the people of this country to believe that he is a great advocate of a free breakfast table, and anything he can do to remit taxation on tea, and, beyond that, to remit taxation on foodstuffs generally, would be a valuable contribution.
Question put, "That the words proposed to be left out stand part of the Bill."

The House divided: Ayes, 222; Noes, 126.

Division No. 325.]
AYES.
[6.35 P.m.


Adamson, Rt. Hon. W. (Fife, West)
Compton, Joseph
Gosling, Harry


Agg-Gardner, Rt. Hon. Sir James T.
Cove, W. G.
Greenall, T.


Alexander, A. V. (Sheffield, Hillsbro')
Cowan, D. M. (Scottish Universities)
Greenwood, A. (Nelson and Coine)


Ammon, Charles George
Crawfurd, H. E.
Grenfell, D. R. (Glamorgan)


Attlee, Clement Richard
Dalton, Hugh
Griffiths, T. (Monmouth, Pontypool)


Baker, J. (Wolverhampton, Bilston)
Davies, Evan (Ebbw Vaie)
Groves, T.


Barker, G. (Monmouth, Abertillery)
Davies, Rhys John (Westhoughton)
Grundy, T. W.


Barnes, A.
Day, Colonel Harry
Guest, Haden (Southwark, N.)


Barr, J.
Dennison, R.
Hall, F. (York, W. R., Normanton)


Batey, Joseph
Duncan, C.
Hall, G. H. (Merthyr Tydvil)


Benn, Capt.-in Wedgwood (Leith)
Donnico, H.
Hamilton, Sir H. (Orkney & Shetland)


Berry, Sir George
Edwards. C. (Monmouth, Bedwellty)
Hardie, George D.


Bowerman, Rt. Hon. Charles W.
Edwards, J. Hugh (Accrington)
Harney, E. A.


Broad, F. A.
Ellis, R. G.
Hartshorn, Rt. Hon. Vernon


Bromley, J.
England, Colonel A.
Hayday, Arthur


Brown, James (Ayr and Bute)
Evans, Capt. Ernest (Welsh univer.)
Hayes, John Henry


Buchanan. G.
Forrest, W.
Henderson, Rt. Hon. A. (Burniey)


Buxton, Rt. Hon. Noel
Foxcroft, Captain C. T.
Henderson, T. (Glasgow)


Charieton, H. C.
Garro-Jones, captain G. M.
Hirst, G. H.


Clowes, S.
Gardner, J. P.
Hirst, W. (Bradford, South)


Cluse, W. S.
Gibbins, Joseph
Hopkinson. Sir A. (Eng Universities)


Clynes, Rt. Hon. John R.
Gillett, George M.
Hore-Belisha, Leslie


Hudson, J. H. (Hiddersfield)
Paling, W
Stephen, Campbell


John, William (Rhondda, West)
Parkinson, John Allen (Wigan)
Stewart, J. (St. Rollox)


Johnston, Thomas (Dundee)
Pethick-Lawrence, F. W.
Sullivan, J.


Jones, Henry Haydn (Merioneth)
Ponsonby, Arthur
Sutton, J. E.


Jones, Morgan (Caerphilly)
Potts, John S.
Thorne, G. R. (Wolverhampton, E.)


Jones. T. I. Mardy (Pontypridd)
Purcell, A. A.
Thurtle, E.


Kelly, W. T.
Rees, Sir Beddoe
Townend, A. E.


Kirkwood, D.
Richardson, R. (Houghton-le-Spring)
Trevelyan, Rt. Hon. C. P.


Lansbury, George
Riley, Ben
Viant, S. P.


Lawson, John James
Robinson, Sir T. (Lancs., Stretford)
Wellhead, Richard C.


Lee, F.
Runciman, Rt. Hon. Walter
Walsh, Rt. Hon. Stephen


Lindley, F. W.
Sakiatvala, Shapurji
Watson, W. M. (Dunfermline)


Livingstone, A. M.
Salter, Dr. Alfred
Webb, Rt. Hon. Sidney


Lowth, T.
Scrymgeour, E.
Wheatley, Rt. Hon. J.


Lunn, William
Shepherd, Arthur Lewis
Wiggins, William Martin


MacLaren, Andrew
Shiels, Dr. Drummond
Wilkinson, Ellen C.


Maclean, Nell (Glasgow, Govan)
Short, Alfred (Wednesbury)
Williams, C. P. (Denbigh, Wrexham)


March, S.
Sinclair, Col. T. (Queen's Univ., Belfst)
Williams, David (Swansea, East)


Mitchell, E. Rosslyn (Paisley)
Sitch, Charles H.
Williams, Dr. J. H. (Lianelly)


Montague, Frederick
Smith, Ben (Bermondsey, Rotherhithe)
Williams, T. (York, Don Valley)


Morrison, R. C. (Tottenham, N.)
Smith, H. B. Lees- (Keighley)
Wilson, R. J. (Jarrow)


Murnin, H.
Smith, Rennie (Penistone)
Wragg, Herbert


Naylor, T. E.
Smith-Carington, Neville W.



Newton, Sir D. G. C. (Cambridge)
Snell, Harry
TELLERS FOR THE AYES.—


Oliver, George Harold
Spencer, G. A. (Broxtowe)
Sir Godfrey Collins and Sir


Oman, Sir Charles William C.
Spoor, Rt. Hon. Benjamin Charles
Robert Hutchison.


Palin, John Henry
Stamford, T. W.



NOES.


Acland-Troyte, Lieut.-Colonel
Crooke, J. Smedley (Deritend)
Hogg, Rt. Hon. Sir D.(St.Marylebone)


Ainsworth, Major Charles
Crookshank, Col. C. de W. (Berwick)
Hope, Capt. A. O. J. (Warw'k, Nun.)


Alexander, E. E. (Leyton)
Crookshank, Cpt. H. (Lindsey, Gainsbro)
Hope, Sir Harry (Forfar)


Alexander. Sir Wm. (Glasgow, Cent'l)
Curzon, Captain Viscount
Hopkins, J. W. W.


Allen, J. Sandoman (L'pool, W. Derby)
Dalkeith, Earl of
Hopkinson, A. (Lancaster, Mossley)


Amery, Rt. Hon. Leopold C. M. S.
Dalziel, Sir Davison
Horlick, Lieut.-Colonel J. N.


Ashley, Lt.-Col. Rt. Hon. Wilfrid W.
Davidson, Mayor-General Sir John H.
Hudson, Capt. A. U. M. (Hackney, N.)


Astbury, Lieut.-Commander F. W.
Davies, Dr. Vernon
Hunter-Weston, Lt.-Gen. Sir Aylmer


Atholl, Duchess of
Davies, Sir Thomas (Cirencester)
Huntingfieid, Lord


Balfour, George (Hampstead)
Dawson, Sir Philip
Hurd, Percy A.


Barclay-Harvey, C. M.
Dixey, A. C.
Hurst, Gerald B.


Barnston, Major Sir Harry
Drewe, C.
Hutchison, G. A. Clark (Midi'n & P'bl's)


Beckett, Sir Gervase (Leeds, N.)
Eden, Captain Anthony
Jackson, Lieut.-Col. Rt. Hon. F. S.


Bellaire, Commander Canyon W.
Edmondson, Major A. J.
Jackson, Sir H. (Wandsworth, Cen'l)


Been, Sir A. S. (Plymouth, Drake)
Elliot, Major Walter E.
James, Lieut.-Colonel Hon, Cuthbert


Bethel, A.
Erskine, Lord (Somerset,Weston-s.-M.)
Jephcott, A. R,


Betterton, Henry B.
Erskine, James Malcolm Monteith
Kennedy, T.


Bird, Sir R. B. (Wolverhampton, W.)
Evans, Captain A. (Cardiff, South)
Kidd, J. (Linlithgow)


Blades, Sir George Rowland
Everard, W. Lindsay
Kindersley, Major Guy M.


Blundell, F. N.
Falle, Sir Bertram G.
King, Captain Henry Douglas


Boothby, R. J. G.
Fanshawe, Commander G. D.
Kinloch-Cooke, Sir Clement


Bowyer, Captain G. E. W.
Fermoy, Lord
Knox, Sir Alfred


Bridgeman, Rt. Hon. William Clive
Fielden, E. B.
Lane Fox, Col. Rt. Hon. George R.


Briggs, J. Harold
Forestier-Walker, Sir L.
Lister, Cunliffe., Rt. Hon. Sir Philip


Brittain, Sir Harry
Fraser, Captain lan
Locker-Lampson, G. (Wood Green)


Brown, Maj. D. C. (N'th'l'd., Hexham)
Frece, Sir Walter de
Lord. Walter Greaves


Brown, Brig.-Gen.H.C.(Berks,Newb'y)
Fremantle, Lieut.-Colonel Francis E.
Lucas-Tooth, Sir Hugh Vere


Buckingham, Sir H.
Gadie, Lieut.-Col. Anthony
Luce. Maj.-Gen. Sir Richard Harman


Bull, Rt. Hon. Sir William James
Galbraith, J. F. W.
MacAndrew, Major Charles Glen


Bullock, Captain M.
Gates. Percy
MacDonald, It (Glasgow, Cathcart)


Burgoyne, Lieut.-Colonel Sir Alan
Gibbs, Col. Rt. Hon. George Abraham
McDonnell, Colonel Hon. Angus


Burman, J. B.
Gilmour, Lt.-Col. Rt. Hon. Sir John
McLean. Major A.


Burney, Lieut.-Com. Charles D.
Goff, Sir Park
Macmillan, Captain H.


Burton, Colonel H. W.
Grace, John
McNeill, Rt. Hon. Ronald John


Caine, Gordon Hall
Graham, Rt. Hon. Wm. (Edin., Cent.)
Maitland. Sir Arthur D. Steel-


Campbell, E. T.
Grant, Sir J. A.
Malone, Major P. B.


Cautley, Sir Henry S.
Grattan-Doyle, Sir N.
Margesson, Captain D.


Cayzer, Sir C. (Chester, City)
Greene. W. P. Crawford
Marriott, Sir J. A. R.


Cecil, Rt. Hon. Sir Evelyn (Aston)
Grotrian, H. Brent
Mason, Lieut.-Col. Glyn K.


Chadwick, Sir Robert Burton
Guinness, Rt. Hon. Walter E.
Meller, R. J.


Chamberlain,Rt.Hn.Sir J. A. (Birm.,W.)
Gunston, Captain D. W.
Meyer, Sir Frank


Charterls, Brigadier-General J.
Hacking, Captain Douglas H.
Milne, J. S. Wardlaw-


Churchill, Rt. Hon. Winston Spencer
Hail, Capt. W. D'A. (Brecon & Rad.)
Mitchell, S. (Lanark, Lanark)


Churchman, Sir Arthur C.
Hammersley, S. S.
Mitchell, W. Foot (Saffron Walden)


Clarry, Reginald George
Hanbury, C.
Mansell, Eyres, Com. Rt. Hon. B. M.


Clayton, G. C.
Hannon, Patrick Joseph Henry
Moore-Brabazon, Lieut.-Col. J. T. C.


Cobb, Sir Cyril
Harland, A.
Moreing, Captain A. H.


Cochrane, Commander Hon. A. D.
Harmsworth, Hon. E. C. (Kent)
Morrison, Bell, Sir Arthur Clive


Colfox, Major Wm. Phillips
Harrison, G. J. C.
Neville, R. J.


Cooper, A. Duff
Hartington, Marquess of
Newman, Sir R. H. S. D. L. (Exeter)


Cope, Major William
Hallam, Henry C.
Nicholson, O. (Westminster)


Couper, J. B.
Henderson, Lieut.-Col. V. L. (Bootle)
Nicholson, Col. Rt. Hn. W. G.(Ptrsf'id.)


Cowan, Sir Wm. Henry (Islingtn., N.)
Henn, Sir Sydney H.
Nuttall, Ellis


Cralk, Rt. Hon. Sir Henry
Hills, Major John Walter
O'Neill, Major Rt. Hon. Hugh




Pennefather, Sir John
Sanderson, Sir Frank
Tryon, Rt. Hon. George Clement


Penny, Frederick George
Scott, Sir Leslie (Liverp'l, Exchange)
Tartan, Sir Edmund Russborough


Percy, Lord Eustace (Hastings)
Shaw, Lt.-Col. A. D. Mcl. (Renfrew, W.)
Vaughan-Morgan, Col. K. P.


Perkins, Colonel E. K.
Shaw, Capt. W. (wilts, Westb'y)
Waddington, R.


Perring, Sir William George
Sheffield, Sir Berkeley
Wallace, Captain D. E.


Peto, Basil E. (Devon, Barnstaple)
Shepperson, E. W.
Warner, Brigadier-General W. W.


Philipson, Mabel
Simms, Dr. John M. (Co. Down)
Warrender, Sir Victor


Pielou, D. P.
Slaney, Major P. Kenyon
Waterhouse, Captain Charles


Pliditch, Sir Philip
Snowden, RI. Hon. Philip
Watson, Sir F. (Pudsey and Otley)


Pownali, Lieut.-Colonel Sir Assheton
Spender-Clay, Colonel H.
Watson, Rt. Hon. W. (Carlisle)


Preston, William
Stanley, Col. Hon. G. F. (WIll'sden, E.)
Watts, Dr. T.


Price, Major C. W. M.
Stanley, Lord (Fylde)
Wheler, Major Sir Granville C. H.


Radford, E. A.
Stanley, Hon. O. F. G. (Westm'eland)
White, Lieut.-Col. Sir G. Dalrymple


Ralne. W.
Steel, Major Samuel Strang
Williams, A. M. (Cornwall, Northern)


Ramsden, E.
Storry.Deans, R.
Williams, Com. C. (Devon, Torquay)


Rawson, Sir Cooper
Stott, Lieut.-Colonel W. H.
Wilson, M. J. (York, N. R., Richm'd)


Reid, Capt. A. S. C. (Warrington)
Streatfeild, Captain S. R.
Wilson, R. R. (Stafford, Lichfield)


Reid, D. D. (County Down)
Stuart, Crichton-, Lord C.
Windsor-Clive, Lieut.-Colonel George


Remer, J. R.
Stuart, Hon. J. (Moray and Nairn)
Winterton, Rt. Hon. Earl


Rantoul, G. S.
Styles, Captain H. Walter
Wise, Sir Fredric


Rhys, Hon. C. A. U.
Sueter, Rear-Admiral Murray Fraser
Wolmer, Viscount


Roberts, E. H. G. (Flint)
Sugden, Sir Wilfrid
Womersley, W. J.


Ropner, Major L.
Templeton, W. P.
Wood, E.(Chest'r, Stalyb'ge & Hythe)


Russell, Alexander West (Tynemouth)
Thom, Lt.-Col. J. G. (Dumbarton)
Worthington-Evans, Rt. Hon. Sir L.


Rye, F. G.
Thompson, Luke (Sunderland)
Young, Rt. Hon. Hilton (Norwich)


Salmon, Major l.
Thomson, Rt. Hon. Sir W. Mitchell-



Samuel, A. M. (Surrey, Farnham)
Tinne, J. A.
TELLERS FOR THE NOES.—


Sandeman, A. Stewart
Tinker, John Joseph
Major Hennessy and Mr. F. C.


Sanders, Sir Robert A.
Titchlield, Major the Marquess of
Thomson.

Division No. 326.]
AYES
[7.57 p.m.


Acland-Tryte, Lieut.-Colonel
Forrest, W.
Nicholson, O. (Westminster)


Agg-Gardner, Rt. Hon. Sir James T.
Foxcroft, Captain C.T.
O'Connor, T. J. (Bedford, Luton)


Alexander, E. E. (Leyton)
Fraser, Captain Ian
Oman, Sir Charles William C.


Allen, J. Sandeman (L'pool, W. Derby)
Frece, Sir Walter de
Pennefather, Sir John


Ashley, Lt.-Col. Rt. Hon. Wilfrid W.
Gadle, Lieut.-Col. Anthony
Penny, Frederick George


Astbury, Lieut.-Commander F. W.
Galbraith J. F. W.
Percy, Lord Eustace (Hastings)


Balfour, George (Hampstead)
Gates, Percy
Perkins, Colonel E. K.


Barclay-Harvey, C. M.
Gault, Lieut.-Col. Andrew Hamilton
Perring, Sir William George


Barnston, Major Sir Harry
Gibbs, Col. Rt. Hon. George Abraham
Pielou, D. P.


Beamish, Captain T. P. H.
Gilmour, Lt.-Col. Rt. Hon. Sir John
Pilditch, Sir Philip


Beckett, Sir Gervase (Leeds, N.)
Glyn, Major R. G. C.
Preston, William


Bellairs, Commander Carlyon W.
Goff, Sir Park
Price, Major C. W. M.


Bennett, A. J.
Grenfell,, Edward C. (City of London)
Radford, E. A.


Berry, Sir George
Grotrian, H. Brent
Raine, W.


Bethel, A.
Gunston, Captain D. W.
Ramsden, E.


Betterton, Henry B.
Hall, Lieut.-Col. Sir F. (Dulwich)
Rawson, Sir Cooper


Birchall, Major J. Dearman
Hammersley, S. S.
Rees, Sir Beddoe


Bird, Sir R. G. (Wolverhampton, W.)
Hannon, Patrick Joseph Henry
Rentoul, G. S.


Blades, Sir George Rowland
Harland, A.
Rice, Sir Frederick


Blundell, F. N.
Harmsworth, Hon. E. C. (Kent)
Roberts, E. H. G. (Flint)


Bourne, Captain Robert Croft
Harvey, Major S. E. (Devon, Totnes)
Ropner, Major L.


Bowyer, Capt. G. E. W.
Haslam, Henry C.
Russell, Alexander West (Tynemouth)


Braithwaite, A. N.
Henderson, Lieut.-Col. V. L. (Bootie)
Rye, F. G.


Briggs, J. Harold
Henn, Sir Sydney H.
Samuel, A. M. (Surrey, Farnham)


Briscoe, Richard George
Hennessy, Major J. R. G.
Sandeman, A. Stewart


Brittain, Sir Harry
Hills, Major John Waiter
Sassoon, Sir Philip Albert Gustave D.


Brocklebank, C. E. R.
Hope, Capt. A. O. J. (Warw'k, Nun.)
Shaw, R. G. (Yorks, W. R., Sowerby)


Brooke, Brigadler-General C. R. I.
Hope, Sir Harry (Forfar)
Shaw, Lt.-Col. A. D. Mcl. (Renfrew, W.)


Brown, Col. D. C. (N'th'l'd., Hexham)
Hopkins, J. W. W.
Shaw, Capt. W. W.(Wilts, Westb'y)


Brown, Brig.-Gen. H. C. (Berks, Newb'y)
Hopkinson, Sir A. (Eng. Universities)
Shepperson, E. W.


Bullock, Captain M.
Horlick, Lieut.-Colonel J. N.
Simms, Dr. John M. (Co. Down)


Burgoyne, Lieut.-Colonel Sir Alan
Howard, Captain Hon. Donald
Skelton, A. N.


Burman, J. B.
Hudson, R. S. (Cumb'l'nd, Whiteh'n
Slaney, Major P. Kenyon


Burney, Lieut.-Com. Charles D.
Hunter-Weston, Lt.-Gen. Sir Aylmer
Smith-Carington, Neville W.


Burton, Colonel H. W.
Hurd, Percy A.
Somerville, A. A. (Windsor)


Caine, Gordon Hail
Hurst, Gerald B.
Stanley, Lord (Fylde)


Cassels, J. D.
Hutchison, G. A. Clark (Midl'n & P'bl's)
Stanley, Hon. O. F. G. (Westm'eland)


Cautley, Sir Henry S.
Jackson, Lieut.-Col. Rt. Hon. F. S.
Steel, Major Samuel Strang


Cayzer, Sir C. (Chester, City)
Jacob, A. E.
Storry-Deans, R.


Cecil, Rt. Hon. Sir Evelyn (Aston)
James, Lieut.-Colonel Hon. Cuthbert
Stott, Lieut.-Colonel W. H.


Chadwick, Sir Robert Burton
Jephcott, A. R.
Streatfeild, Captain S. R.


Charteris, Brigadier-General J.
Jones, G. W. H. (Stoke Newington)
Stuart, Crichton-, Lord C.


Churchill, Rt. Hon. Winston Spencer
Kennedy, A. R.(Preston)
Stuart, Hon. J. (Moray and Nairn)


Churchman, Sir Arthur C.
Kidd, J. (Linilthgow)
Styles, Captain H. Walter


Clarry, Reginald George
Kindersley, Major Guy M.
Sugden, Sir Wilfrid


Clayton, G. C.
King, Captain Henry Douglas
Templeton, W. P.


Cobb, Sir Cyril
Lister, Cunliffe-, Rt. Hon. Sir Phillip
Thom, Lt.-Col. J. G. (Dumbarton)


Cochrane, Commander Hon. A. D.
Locker-Lampson, G. (Wood Green)
Thomson, F. C. (Aberdeen, South)


Colfax, Major Wm. Phillips
Lougher, L.
Tinne, J. A.


Conway, Sir W. Martin
Lucas-Tooth, Sir Hugh Vere
Titchfield, Major the Marquess of


Cooper, A. Duff
Luce, Major-Gen. Sir Richard Harman
Tryon, Rt. Hon. George Clement


Cooper, J. B.
MacAndrew, Major Charles Glen
Turton, Edmund Russborough


Craig, Ernest (Chester, Crewe)
Macdonald, Capt. P. D. (I. of W.)
Vaughan-Morgan, Col K. P.


Craik, Rt. Hon. Sir Henry
Macdonald, R. (Glasgow, Cathcart)
Waddington, R.


Crooke, J. Smedley (Derltend)
McDonnell, Colonel Hon. Angus
Wallace, Captain D. E.


Crookshank, Col. C. de W. (Berwick)
McLean, Major A.
Warrender, Sir Victor


Crookshank, Cpt. H.(Lindsey, Gainsbro)
Macmillan, Captain H.
Waterhouse, Captain Charles


Cunliffe, Sir Herbert
Macnaghten, Hon. Sir Malcolm
Watson, Sir F. (Pudsey and Otley)


Dalkeith, Earl of
McNeill, Rt. Hon. Ronald John
Watson, Rt. Hon. W. (Carlistle)


Dalziel, Sir Davison
Maitland, Sir Arthur D. Steel-
Watts, Dr. T.


Davidson, Major-General Sir J. H
Malone, Major P. B.
Wells, S. R.


Davies, Dr. Vernon
Margesson, Captain D.
Wheler, Major Sir Granville C. H.


Davies, Sir Thomas (Cirencester)
Marriott, Sir J. A. R.
Williams, Com. C. (Devon, Torquay)


Davison, Sir W. H. (Kensington, S.)
Meller, R. J.
Williams, Herbert G. (Reading)


Dawson, Sir Philip
Merriman, F. B.
Wilson, R. R. (Stafford, Lichfield)


Crewe, C.
Meyer, Sir Frank
Windsor-Clive, Lieut.-Colonel George


Eden, Captain Anthony
Milne, J. S. Wardlaw-
Winterton, Rt. Hon. Earl


Edmondson, Major A. J.
Mitchell, S. (Lanark, Lanark)
Wise, Sir Fredric


Elliot, Major Walter E.
Monchell, Eyres, Com. Rt. Hon. B. M.
Womersley, W. J.


Ellis, R. G.
Moreing, Captain A. H.
Wood, E. (Chester, Stalyb'ge & Hyde)


Everard, W. Lindsay
Morrison-Bell, Sir Arthur Clive
Worthington-Evans, Rt. Hon. Sir L.


Falle, Sir Bertram G.
Nall, Lieut.-Colonel Sir Joseph
Wragg, Herbert


Fanshawe, Commencer G. D.
Neville, R. J.



Fermoy, Lord
Newman, Sir R. H. S. D. L. (Exeter)
TELLERS FOR THE AYES.—


Forestier-Walker, Sir L.
Newton, Sir D. G. c. (Cambridge)
Major Cope and Captain Viscount Curzon




NOES


Adamson, Rt. Hon. W. (Fife, West)
Attlee, Clement Richard
Barr, J.


Alexander, A. V. (Sheffield, Hillsbro')
Baker, J. (Wolverhampton, Bilston)
Batey, Joseph


Ammon, Charles George
Barker, G.(Monnmouth, Abertiliery)
Benn, Captain Wedgwood (Leith)




Bowerman, Rt. Hon. Charles W.
Heyday, Arthur
Salter, Dr. Alfred


Broad, F. A.
Hayes, John Henry
Scrymgeour, E.


Bromfield, William
Henderson, Right Hon. A. (Burnley)
Shaw, Rt. Hon. Thomas (Preston)


Bromley, J.
Henderson, T. (Glasgow)
Short, Alfred (Wednesbury)


Brown, James (Ayr and Bute)
Hirst, G. H.
Sinclair, Major Sir A. (Caithness)


Buchanan, G.
Hirst, W. (Bradford, South)
Sitch, Charles H.


Buxton, Rt. Hon. Noel
Hore-Belisha, Leslie
Slesser, Sir Henry H.


Charleton, H. C.
Hudson, J. H. (Huddersfield)
Smillie, Robert


Clowes, S.
Jenkins, W. (Glamorgan, Neath)
Smith, Ben (Bermondsey, Rotherhithe)


Cluse, W. S 
John, William (Rhondda, West)
Smith, H. B. Lees (Keighley)


Clynes, Rt. Hon. John R.
Johnston, Thomas (Dundee)
Smith, Rennie (Penistone)


Collins, Sir Godfrey (Greenock)
Jones, Henry Haydn (Merioneth)
Snell, Harry


Compton, Joseph
Jones, Morgan (Caerphilly)
Snowden, Rt. Hon. Philip


Cove, W. G.
Jones, T. I. Mardy (Pontypridd)
Spencer, G. A. (Broxtowe)


Cowan, D. M. (Scottish Universities)
Kelly, W. T.
Spoor, Rt. Hon. Benjamin Charles


Dalton, Hugh
Kennedy, T.
Stamford, T. W.


Davies, Evan (Ebbw Vale)
Kirkwood, D.
Stephen, Campbell


Davies, Rhys John (Westhoughton)
Lansbury, George
Stewart, J. (St. Rollox)


Day, Colonel Harry
Lawson, John James
Sullivan, J.


Dennison, R.
Lee, F.
Sutton, J. E.


Duncan, C.
Lindley, F. W.
Thorne, G. R. (Wolverhampton, E.)


Dunnico, H.
Livingstone, A. M.
Thurtle, E.


England, Colonel A.
Lowth, T.
Tinker, John Joseph


Garro-Jones, Captain G. M.
Lunn, William
Townend, A. E.


Gardner, J. P.
Maclean, Neil (Glasgow, Govan)
Viant, S. P.


Gibbins, Joseph
March, S.
Wallhead, Richard C.


Gillett, George M.
Mitchell, E. Rosslyn (Paisley)
Walsh, Rt. Hon. Stephen


Gosling, Harry
Montague, Frederick
Watson, W. M. (Dunfermilne)


Graham, D. M. (Lanark, Hamilton)
Morris, R. H.
Webb, Rt. Hon. Sidney


Graham, Rt. Hon. Wm. (Edln., Cent.)
Murnin, H.
Welsh, J. C.


Greenall, T.
Oilver, George Harold
Wiggins, William Martin


Greenwood, A. (Nelson and Coins)
Palin, John Henry
Wilkinson, Ellen C.


Grenfell, D. R. (Glamorgan)
Palling, W.
Williams, C. P. (Denbigh, Wrexham)


Griffiths, T. (Monmouth, Pontypool)
Parkinson, John Allen (Wigan)
Williams, David (Swansea, East)


Groves, T.
Pethick-Lawrence, F. W.
Williams, Dr. J. H. (Llanelly)


Grundy, T. W.
Ponsonby, Arthur
Williams, T. (York, Don Valley)


Hall, F. (York, W. R., Normanton)
Potts, John S.
Wilson, R. J. (Jarrow)


Hall, G. H. (Merthyr Tydvil)
Purcell, A. A.



Hardie, George D.
Richardson, R. (Houghton-le-Spring)
TELLERS FOR THE NOES.—


Hartshorn, Rt. Hon. Vernon
Riley, Ben
Mr. Charles Edwards and Mr. Barnes.

Orders of the Day — NEW Cuuse.—(Allowance for wasting assets.)

For the purpose of enabling deductions from revenue receipts of expired capital outlay on inherently wasting assets in the case of mines of coal and other mines to be allowed by the additional Commissioners claims in respect of those deductions shall be included in the annual statement required to be delivered under the Income Tax Acts of the profits and gains of any trade, manufacture, adventure, and concern, and where such a deduction from the revenue receipts is made, and has been made, from the commencement of the actual employment of the inherently wasting assets in seeking profits or during a period of not, less than three years to the end of the usual financial year of the particular trade, manufacture, adventure, or concern last prior to the year of assessment, and provided such deduction is so made as to prevent the same being available as profits the additional Commissioners, in assessing those profits and gains, shall make such allowances in respect of those claims as they think just and reasonable.

For the purpose of this Section the term "inherently wasting assets" means assets which necessarily waste in tie process of seeking profits.

Provided always that such wasting assets are not the value of transferred rights to future profits or increase which would have been chargeable with Income Tax if no transfer of such rights had been made.— [Mr. Greaves-Lord.]

Brought up, and read the First time.

Mr. GREAVES-LORD: I beg to move, "That the Clause he read a Second time."
I ought to point out, in moving this Clause, that the definition of wasting
assets means assets which necessarily waste in the process of seeking profits. Some people on reading this Clause thought it had some relation to the Betting Duty, where the assets must necessarily waste in seeking profits. The Clause applies entirely to mining. This is a time when injustices of taxation should be removed from such an industry as mining. Every hindrance to industry should be removed, and any injustice of taxation is one which specially calls for removal. The whole idea of this Clause is to give to those who are running mines the same allowances as those who run factories. The position at the present time is that if you put up a chimney you are allowed depreciation in taking your accounts, but if you sink a shaft, which depreciates in exactly the same way, you are not allowed any depreciation. The result is, that as far as the capital which is expended in the sinking of shafts and tunnelling is concerned, no allowance is made in arriving at profits, although a shaft and a. tunnel are wasting assets and depreciate from year to year. If the Clause could be accepted, a very serious injustice would be removed. I hope the Chancellor of the Exchequer will see his way to accept it.

Mr. B. PETO: I beg to second the Motion.
On previous occasions I have moved a similar Clause of rather wider application. This new Clause is limited to coal and other mines. On the question of wasting
assets generally, the adoption of the recommendations of the Royal Commission on Income Tax in 1920 would be a method by which the Chancellor of the Exchequer could give relief to productive industry in this country, and consequently assist in the employment of labour, in a more direct and immediate manner than in any other way that could be conceived. The Royal Commission in that section of their Report which deals with wasting assets and the present law point out that
The only wasting assets for which an Income Tax allowance is now made are plant and machinery, and certain buildings that contain plant and machinery.
Later on in their Report they recommend, in paragraph 200:
Subject always to the limitation that their life falls short of 35 years, we recommend that an allowance shall be given in respect of all inherently wasting material assets which have been created by the expenditure of capital, such as buildings and foundations, surface works, permanent way and equipment of railways and tramways, docks and shaft-sinkings, and initial work on development. In every case the allowance should he calculated by reference not to the absolute but to the relative liability to waste.
Here we have a definite recommendation of the Royal Commission that shaft sinkings should be subject to this allowance for wasting assets or depreciation. Undoubtedly, in the present state of the coalmining industry in this country there is a very strong case for giving an allowance which was recommended six years ago by the Royal Commission. Under the arrangement existing in the coalmining industry, it would not be an allowance which would fall into profit exclusively for the benefit of the owners, because any additional profit additional to the present profits are divided under the agreement as to 87 per cent. in increased wages and 13 per cent. to the owners of the mines. Therefore, there is no point to be made against the Clause from that point of view.

Mr. McNEILL: My hon. Friend the Member for Barnstaple (Mr. B. Peto), in seconding the Clause, said that he moved a Clause last year in similar terms. The Clause which my hon. Friend moved last year was very different from the present one, and I think it was an inadequate description of it to say that it was on somewhat wider lines. The
Clause which he moved last year dealt with wasting assets generally. My hon. and learned Friend the Member for Norwood (Mr. Greaves-Lord), who has moved the present Clause, confines it solely to coal and other mines. This question of wasting assets and the equitable manner of dealing with them is a very old Budget subject. There have been a great many proposals for dealing with it, going back a great number of years. One Chancellor of the Exchequer after another has approached the problem by admitting that it requires to be dealt with and that a strong case can be made out in regard to wasting assets, but they have almost all finished up by saying that they have been unable to find the right and proper way in which to deal with it, and have admitted themselves incapable of solving the problem.
As long ago as 1912 the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George), who was at that time Chancellor of the Exchequer, said, with reference to a proposal similar to one which was made last year, that it would cost the Exchequer £2,000,000. I want particularly to call the attention of the House to the following words used by the right hon. Gentleman, which are quite true. He said that it was almost impossible to redress the grievance without a complete reconstruction of the Income Tax. That is because it is such an extraordinarily involved and difficult subject. Certainly if we were to agree to deal with the subject now, it would require a number of very controversial Clauses, every one of which would be open to very serious controversy and discussion, and rightly so, because it would be extremely difficult to draft a Clause which would satisfactorily deal with the matter. The objection is not merely based on the question of drafting, but on the fact that it would enormously add to the complexity of the Income Tax law and the complexity of Income Tax administration. I do not say that that is a conclusive reason against a proposal of this sort, but it is a very serious objection, especially at a time when my right hon. Friend is endeavouring, I think with the approval of all parties, to simplify, if possible, the administration of the Income Tax, which is becoming frightfully complex as time goes on, and in many cases almost unintelligible. That is a reform which everybody would like
to see carried out, but undoubtedly if we were to deal with this subject of wasting assets, so far from simplifying the Income Tax, it would immensely add to the complexity of the subject.
My hon. Friend who seconded the Clause referred to the Report of the Royal Commission and seemed to claim the support of the recommendations of the Royal Commission for this proposal. I think he is under a complete misapprehension in that respect. The Royal Commission on Income Tax made a number of recommendations in favour of dealing with the subject of wasting assets in many of its aspects, but there was one emphatic refusal, one emphatic negative in regard to one aspect, and that was exactly the proposal which is made in this Clause. The Royal Commission, whilst saying that allowances of one sort and another might be made, said:
No allowance should be granted to incomes arising from wasting assets which consist of the proprietorship of natural resources in this country.
Income derived from mines is expressly excluded by the Royal Commission. They went most carefully and fully into the whole of this very complicated and difficult subject, and they expressly excluded from their recommendations the very subject which my hon. and learned Friend has singled out from the others to put forward in this new Clause. That is why I say that this new Clause differs a great deal from the proposal made by the hon. Member for Barnstaple last year. In the wider manner of dealing with this matter which he proposed, he could have claimed in many of its aspects the support of the Royal Commission; but the very aspect which has been singled out by my hon. and learned Friend in this Clause comes under the express veto of the Royal Commission. Upon that ground alone we should be justified in declining to accept the Amendment, but must, in candour, admit that, quite apart from the attitude of the Royal Commission in this respect, the difficulty and complexity of the subject and the far-reaching complexity in which we should be involved in carrying out this proposal, would make it absolutely necessary for us to say that although in principle there is a great deal to be said for dealing with wasting assets the subject is far too difficult for us to deal with it in the present Finance Bill.

Mr. PETO: Will the right hon. Gentleman bear in mind that the Royal Commission made a distinction between minerals in mines and the material assets which they expressly allude to and which are covered by their recommendation.

Mr. McNEILL: My hon. and learned Friend does not draw that distinction.

7.0 P.M.

Mr. BARKER: I think it would take all the K. C.'s in the House to explain what this new Clause means. As a lay Member of the House, I am full of suspicion in regard to the Clause. In calculating wasting assets, I should like to know whether any calculation is to be made of the profit earned by the companies during the time that the assets have been wasting. Do the royalty owners come under this Clause? The Duke of Northumberland has stated several times in public that his estate is a wasting asset. I am full of suspicion that there is something ulterior about this Clause; something that I cannot see through. If the House goes to a Division, I shall certainly vote against the Clause. I should have liked to have had some more explanation with reference to it. A subject that is so complicated and involved as this cannot be lightly passed over in the few words the right hon. Gentleman used. I have a very strong suspicion myself that if this Clause got through the royalty owners would come into it. For that reason, if for no other, I should vote against it. I should like to know whether those wasting assets do really take into calculation the profits that are being made while the assets are wasting. Some of those colliery companies realise their capital many times over before the mines are exhausted.

Captain BENN: It would be very helpful if the hon. and learned Member for Norwood (Mr. Greaves-Lord) would tell us if the result of his Clause would be to permit relief from some part of the Mineral Rights Duty payable by the royalty owners.

Mr. GREAVES-LORD: It would not have any effect in relieving the royalty owner.

Captain BENN: What is meant in the definition of wasting assets in line 15? If the hon. and learned Gentleman says it could not relieve the royalty owner of
a part of his Income Tax—he is an eminent legal authority—I accept his definition of his own Clause. It deserves notice, however, that at last the Conservative party have made some constructive suggestion for the solution of the coal crisis.

Mr. MONTAGUE: I just want to say a word or two on this Clause. It seems to me the proposal of the hon. and learned Member is one which is more subtle than appears on the surface. I can understand any proposal to assist the coal mining industry at the present time, although I might not feel inclined to agree with a proposal of this character from that standpoint. It does seem to me that the idea of making an allowance for wasting assets with regard to the coal mines might apply to any other industry, and if an industry requires to be assisted by allowances of that kind let us be straight and direct about it, and take the line that the capital of the company, the plant and the buildings of the company should, apart from waste, be relieved simply because of the necessity for relieving the industries of the country generally. The point surely is this, that the fact of the assets wasting is a proof of the advantage that has been gained by the concern. The more the assets waste, the better for the industry concerned, because it indicates there is prosperity in that industry, and it is the business surely of the industry to reclaim that waste by applying its surplus to the restoration of the capital and the plant. For those reasons I propose to oppose this Clause, particularly as it does not appear to be put forward with any great definiteness.

Question, "That the Clause be read a Second time," put, and negatived.

Orders of the Day — NEW CLAUSE.—(Amendment of 10 Edw. VII., c. 8.)

Notwithstanding anything contained in this or any other Act to the contrary. The Finance (1909–10) Act, 1910, Schedule I (c.) (Provisions applicable to retailers' off-licences, Spirits; (2) Minimum quantity of spirits to be sold), shall be deemed to have effect, as if, in lieu of the words "one reputed quart bottle," there were inserted the words "one reputed pint bottle," and accordingly the minimum quantity which may be sold by a person holding an off-licence to be held by a retailer of spirits shall be in England one reputed pint bottle.—[Sir Philip.Dawson.]

Brought up, and read the First time.

Sir PHILIP DAWSON: I beg to move, "That the Clause be read a Second time."
I will only detain the House a few minutes because the subject matter is well known to Members of the House and to the Treasury. I trust my right hon. Friend may see his way to grant the request. The Clause is intended to enable poor people who wish to get a half bottle of wine for medicinal purposes to do so. At present, if they require brandy, they have to buy a full bottle. I cannot see that the Exchequer will lose anything by this, and I trust the Chancellor of the Exchequer will be able to see his way to agree that this Clause be accepted.

Mr. MURROUGH WILSON: I beg to second the Motion.

Mr. McNEILL: My hon. Friend was commendably brief in putting this Clause before the House, and I hope he will not mind if I am equally brief in telling him that it is impossible to accept it. The reason I cannot accept it is one that has been very often explained to the House. It is this. To make the change would be to interfere with the whole balance of the licensing laws in this country. Anyone who has given even the smallest study to our licensing laws knows what a hornet's nest he might raise if he began interfering with one particular branch of that law. My hon. Friend, I notice, in putting forward his proposal, spoke of it as being merely intended to enable poor people who wanted a little brandy, for the sake of their health, to procure it in small quantities. That is not his proposal. It is not by any means confined to brandy required for health or under doctor's orders. It goes very much wider and includes all spirits. When I had a deputation to see me on this subject some weeks ago, they made a good deal of the point of the desirability of enabling people in had health, especially under doctors' orders, to get a little brandy, in smaller quantities than the quart bottle, from the grocers. I made the suggestion—I did not pledge myself—that that point might be made by making a special provision for brandy in such cases. I found that proposal did not give any satisfaction whatever. I was immediately told there were other spirits of medicinal value.
Therefore it really comes down to a proposal to alter the balance of the licensing law. A differentiation which has lasted now for a great number of years, and which is reflected in the relative licence duties imposed on different classes, would be a most dangerous thing to interfere with. It would require a great deal more consideration of the whole subject than it is possible to give when raised by this Amendment. Moreover, I am very sceptical indeed as to there being any real public demand for this change. I know there is a very respectable class of person who is the holder of an off-licence who would like to have extended privileges, if he could get them, without having to pay any additional licence duty for them. I should be very glad if it were possible without doing any harm in any other direction to meet those wishes. I do not think there is really any widespread grievance to be met, or that there is any widespread case to be made by the public at large. In those circumstances, and having regard to the disturbance that would be created, I hope my hon. Friend will be satisfied, and will not insist on dividing the House.

Mr. BARR: The right hon. Gentleman has said that this would disturb the balance as between the on- and the off-licence. It would, for example, in a district where there was no on-licence. It would lead to defeating very much in some cases the purposes of the magistrates in refusing such a licence. In the second place we know that the grocers' licences are often used by those who are not so straightforward as to go to an on-licence, and who use many subterfuges to obtain liquor in that way. We have a strong suspicion often of the purposes to which the on-licence may be put and the means that may be used to secure liquor under some other name altogether. Thirdly, I wish to call attention to the ground on which this was put forward that it was for medicinal uses. I am not here to argue nor do I suppose we would be free to launch out into any argument as to the medicinal value of alcohol in various forms. Personally, although I am an extremist in the temperance cause, I have never taken up the position that you might not take alcohol when it is really prescribed by a physician. The point I find is, that many people wish to be their own physicians, and make their
own prescriptions in this particular matter.
I have never taken up an extreme position in regard to the medical use of alcohol. I have often said, you may as well take alcohol as any other poison the doctor may prescribe. But I will tell you what has shaken my faith in the value of alcohol as a medicine to a considerable extent. The great value of any medicine is that it does its work so thoroughly that you are done with the cure as well as with the disease. I once had occasion in examining candidates for a vacancy in connection with a Church appointment, to put before them the question I was instructed to put, whether they were strictly temperate. Two of them gave me exactly the same answer, that once some years before they had an illness, the doctor prescribed a little spirits, and they had gone on taking a little ever since. Can you conceive a greater condemnation of any medicine than that it makes you an invalid for life? Everyone knows that there has been a tremendous change in medical opinion in regard to the medicinal value of all those alcoholic liquors. Without wearying the House, I may mention that the Wandsworth Union in 1875 were spending on alcohol as a medicine £275. In 1914 they spent 8s., and the milk bill in that hospital rose in he same period from £407 to £1,330. If you take the seven leading hospitals in London you will find that in the year 1862 they were spending on alcohol as medicine £7,712, and exactly 50 years thereafter with a much larger population they were down to £1,238, and the milk bill rose in the same period from £3,026 to £,11,874. The party opposite pose as the great friends of agriculture, and I suggest that instead of trying to get new ways and means for the distribution of liquor they would serve the interests of agriculture much better if they brought in new methods of securing and distributing milk, which is really a food.

Mr. SC RYMGEOUR: I think we should consider the real position with which this House is confronted whenever such a proposal as this is presented to it. If this production is a legitimate commodity why should not people be able to obtain it in any kind of shop and without any restrictions or licensing anomalies to which exception is taken to-day. The Financial
Secretary has said that if this Amendment was adopted it would upset the balance of a licensing law. It is the licensing law which is really responsible for upsetting the balance of many people in this country. And you have to face another proposition. What objection can be taken by those who believe in having the contents of the bottle whether it is a pint bottle or a quart bottle. When that arrangement was made all that happened was that people who found any difficulty in getting a larger supply were able to make arrangements by which one person bought and then shared the contents of the bottle with others. If hon. Members who are concerned about the removal of these anomalies would go to the full extent of their claim—the liberty of the subject—they would fight the Government in order to secure the repeal of all our licensing liquor laws and let everybody supply drink as they thought fit, get as much drink as they could get so long as they could pay for it. They fear to face that practical and logical proposition in a desire to sustain a monopoly in their own financial interests. It is a monopoly which is a serious menace to the nation at large, and the only question is the removal of the whole thing altogether.

Lieut.-Colonel JAMES: I only intervene in the Debate in order to reply to the hon. Member who has just spoken and to mention my own attitude on this matter. Last year I had the honour of moving this Amendment and I quite understand that there may be financial reasons which make it impossible for the Government to accept it. It is probable that the acceptance of this Amendment would upset what one may describe as the financial balance of the Budget. Interested parties have spoken about grocers' licences and the public house licences, but I do not think it is possible to defend the refusal of the half-pint measure to the off-licence people. The hon. Member for Dundee (Mr. Scrymgeour) said that if we upheld the liberty of the subject all these restrictions on liberty would be at once removed. I do not think that would alter the situation in the least. He is perfectly sincere but almost a monomaniac in his view of the situation. If you remove the restrictions and allow liquor to be sold without excise licence duties the revenue
would have to be raised from other sources, and we are discussing how the revenue of the country is to be raised.

Mr. SCRYMGEOUR: The easiest thing in the world.

Lieut.-Colonel JAMES: Many other hon. Members have had the same thing, but it is not easy when you wish to distribute the burden of taxation equally over each section of the community, which I suggest is the, motive that has actuated Chancellors of the Exchequer of all parties for a great many centuries. Whether they have been successful or not is another question. In some cases you may find Chancellors of the Exchequer who have been inclined to be vindictive. I hope, when the finances of the country are on a more equitable basis, when we are not faced with the circumstances which are present at the moment, when the taxpayer is being called upon to pay vast sums of money without any rhyme or reason because sectional interests in the community will not agree, when the right of the subject to exist is being denied because certain people claim the right to strike—

Mr. SPEAKER: I do not see any connection between the right to strike and pints and quarts.

Lieut.-Colonel JAMES: I agree, but the burden of taxation on the country due to the strike is so heavy that any mitigation is not possible.

Sir P. DAWSON: In view of what has been said by the Financial Secretary to the Treasury I beg leave to withdraw the Clause.
Motion and Clause, by leave, withdrawn.

Orders of the Day — CLAUSE 3.—(Exemption of trade motor cars from Customs Duty to cease.)

Mr. LEES-SMITH: I beg to move to leave out the Clause.

Captain BENN: On a point of Order. I am not quite clear if we have this Motion whether it will rule out the Amendment to which I have my name—to leave out the word "May" and insert "June"?

Mr. DEPUTY-SPEAKER (Mr. James Hope): I understood that that was not going to be moved. Does the hon. and gallant Member wish to move it?

Captain BENN: It does not raise the general question of the Clause at all. It covers quite a small point, and I was asked to put it down on behalf of the London Chamber of Commerce in order to ask a question of the Chancellor of the Exchequer. That is my only purpose.

Mr. DEPUTY-SPEAKER: I hope the Amendment will be saved.

Mr. LEES-SMITH: This is a Clause which extends the McKenna Duties to commercial motor cars. We only intend
briefly to state our objections to it, and to take a Division. This extension of the duty to commercial motor cars contradicts every statement and every argument by which the Chancellor of the Exchequer supported the re-introduction of the McKenna Duties. His argument when he re-imposed these duties was, that they were duties of a purely luxury type, on articles of enjoyment and recreation simply, and that they would have no effect on the prices of manufactured articles. Now he has found himself in the position in which, in order to retain his luxury duties, he is compelled to place duties on articles which enter into practically every industry in the land and which affect the prices of practically every article produced in the country. Hon. Members opposite, in the last Debate, attempted to argue that this duty would have no effect on the price of commercial motor cars, but those trades that are going to use them have sent a protest to every Member of this House.
We have all had letters from the Farmers' Union who argue, and argue quite rightly, that as they are forbidden to have protection it is unjustifiable to
ask them to pay this tribute to an industry whose prospects are far brighter than their own. The Chancellor of the Exchequer said it had nothing to do with Protection, but that the Customs House was put into certain difficulties in distinguishing between the parts of these cars and the parts of private cars, and the duty had therefore to be imposed. That argument justifies the objection we originally urged. If he now finds himself in a position in which he imposes duties on certain articles, and then finds that in order to retain those duties he is compelled to impose them on other articles, then his proper action is to withdraw these duties, instead of adding others. We quite know why he cannot do this. The reason is that this duty is supported by the hon. Members behind him on purely Protectionist grounds. The Chancellor of the Exchequer in the last Debate told us that these duties did not raise the issue of Protection or Free Trade but in every speech in which hon. Members behind him supported him, the speech was based on the grounds of sheer Protection. I was interested to follow the argument used by one hon. Member opposite, and it comes with greater and greater frequency from Conservative speakers—that if you propose a protective duty on, say, commercial motor cars, they obtain larger markets and manufacturers can work on a larger scale and bring down overhead charges, and thus reduce prices. That is the argument I hear over and over again with increasing frequency. So far as it is true that by producing on a larger scale manufacturers can lower prices, that is an argument not for Protection but for amalgamation. It is exactly the position that has arisen in the coal trade, and the very remedy the Government themselves are proposing is amalgamation. When other trades come forward with that argument our reply to them is, "Let them amalgamate," If they are not willing to amalgamate then they are not entitled for that reason to ask other industries to pay them a tribute in order to do what these industries ought to do for themselves, and for that reason I beg to move.

Mr. MARCH: I beg to second the Amendment.
I think we can claim to say that we are not absolutely one-sided in connection
with our views on this matter. On the last Clause that we were discussing we stated it would be a great relief to the poorer class. On this occasion we cannot claim that as a reason why we are bringing this forward, because it cannot be said that a large number of the poorer class use commercial cars or luxury cars or are concerned about the component parts of the car. Therefore, it ought to appeal to the people on the other benches—when they are there. It ought to appeal to those people on the Government side because they are the people mostly concerned in using the cars most mentioned in this Clause, either commercial or luxury. We usually find that they are not over-patriotic about using British cars, although they are concerned in advertising that British goods are best. We do see some of them using foreign cars, and naturally if they get the foreign-made cars they do want the component parts sometimes if they have got worn out. I therefore think the Chancellor of the Exchequer would be doing a good turn to some of his supporters if he would have this Clause deleted.
It is quite true that the users of commercial cars are beginning to wake up to what this duty means. I think nearly all the Members of the House have received circulars in connection with this matter, and it has not surprised me at all, because when the Chancellor brought forward this matter in his Budget proposals, I said that what we were going to impose on commercial vehicles would naturally be passed on, in increased charges. In the end, it is always the consumer who pays, and this duty will be passed on to such people, for example, as those who desire to remove their furniture. The removal contractors state that if this duty is to be imposed, to the extent proposed by the Chancellor of the Exchequer, they will have to increase their charges. Occasionally poor people have to move, whether they want to do so or not, and they will have to pay. In all the circumstances I think the right hon. Gentleman ought to agree to the deletion of this Clause, and thus help the people who use commercial vehicles instead of hampering them.

Mr. HARDIE: This appears to be a completely Protectionist Clause, and I want to try to persuade the Chancellor of the Exchequer to withdraw it. I may
be able to do so, because the quotations which I propose to make come from one who, I am quite certain, the right hon. Gentleman has no desire to contradict. I have brought into the House with me a book. The Chancellor may not think himself a great man, but his portrait figures on the cover of this volume and the old phrase:
Oh that mine adversary had written a book
enters into this matter. The right hon. Gentleman looks much better in that picture than he does now.

Mr. CHURCHILL: We are all getting on.

Mr. HARDIE: It is not a question of age. I am taking other factors of difference into account as between the time when the right hon. Gentleman wrote his book and the present time. As a man thinks so he becomes, and the right hon. Gentleman is looking much better in that picture than he looks to-day. I wish to take some of his statements in this book in regard to the matters before the House. He says on page 33:
Protective tariffs have warped and restricted the growth of the industries of the nations who have adopted them,
and again,
Protection will not stop unemployment.
Then he goes on to give ample proof that the principle by which he stands today is absolutely wrong. Either he must tell the House that he was wrong then and is right now, or he must admit that he was right then and is wrong now.

Mr. SANDEMAN: The circumstances may have changed.

Mr. HARDIE: The circumstances have changed but have changed all in favour of the right hon. Gentleman having been right when he wrote this book. On page 133 he talks about the vagueness of a tariff and he writes:
We catch a glimpse of its glittering skirts in the flourish of a peroration. We find some reference to it upon a half sheet of notepaper. It figures in the after-dinner speeches of irresponsible persons. We try to follow it through the cryptic pronouncements and laboured ambiguities of political leaders. We have it brought to our notice by the puffs and paragraphs and trial balloons of the inspired or semi-inspired or wholly imaginative Press.
[HON. MEMBERS: "Is that Socialism?"] If hon. Members knew the political history of the country as they ought to-know it they would be acquainted with this book. If they wished to know about the political changes that have taken place they should learn what this book has to tell them. This Clause establishes the beginning of absolute full Protection. I do not wish to use all the arguments employed by the Chancellor of the Exchequer against that policy but I ask him to tell us whether he has altogether forsaken that which was the virtue of his youth and has gone completely astray?

Mr. CHURCHILL: I hold in very considerable respect the opinions which the hon. Gentleman has just quoted, and I should be very sorry if I found myself needlessly in collision with them at any time, but, after all, we must take cognisance of the march of events. If the so-called McKenna Duties, or any ancillary additions to the so-called McKenna Duties should be held to come into collision with any of the doctrines contained in that volume from which the hon. Gentleman has quoted, then it is perfectly well known that the friction began, not in this Budget nor in the last Budget, not in this Parliament nor in the last Parliament nor in the Parliament before that, but as early as the year 1915 or the beginning of 1916, when these duties were proposed by a Government headed by no less an authority and no more faithful an adherent of Free Trade than Lord Oxford himself. The duties are associated with the name of one of the greatest Free Trade authorities, Mr. McKenna, and were supported by the subsequent Coalition Government under the leadership of the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George). They were supported, not only by representatives of his party but also by representatives of the Labour party, who were officially represented in that Government. I, as a subordinate functionary, in those days naturally felt that I could not stand single-handed against all the parties in the State. If I am to be reproached, I can only say that I share my fault with three great parties in the State and the most eminent leaders of those parties.
We have reimposed the McKenna Duties for purposes of revenue. That was the sole object if had in view. It may
well be that a duty imposed, sincerely and soundly, for one purpose may commend itself to other people because it happens incidentally, to achieve other objects, in themselves highly arguable at least, but possibly defensible.
The McKenna Duties, imposed solely for revenue purposes, were found to contain a curious gap in that certain commercial motors were found to have escaped, and the burden of this non-inclusion has thrown upon the Customs officials a difficulty, that of tracing the spare parts, etc. They have discovered how narrow, shifting and ambiguous was the line which divides the commercial use from the pleasure use of cars, and how impossible it was to track the original vehicle through all its phases and changes, and it has been felt that in the interests of simplification it was desirable to add this Clause on motor vehicles to keep in general line with the McKenna Duties. I have explained before that my reasons were twofold: administrative convenience and additional revenue. I have no other reason whatever. Those reasons are perfectly just and adequate. It may be that other hon. Members have other objects to the revenue produced by the taxes. I welcome, the support which I receive on any ground; in support of a policy which is in itself inherently and ineffaceably sound.
I myself do not believe in the present state of the commercial motor industry that the position of the users, in view of the comparatively small quantity of foreign cars that come into this counry, will be materially affected. Nor do I believe that the price of the home article will be affected in the way suggested. I believe that the competition in the British commercial motor trade is sufficiently keen and strong to keep the price down. It may even be in the case of a rapidly expanding industry that this new factor of being able to produce on a larger scale, and with a greater assurance of sale will have the effect of producing a cheaper article. It is not from the standpoint of tariffs or fiscal policy that I am introducing the duty but solely for the two perfectly good and sufficient reasons that I have already mentioned to the House. I should have thought that in view of the three or four occasions on which we have debated this matter that we would have exhausted the possibility of argument, and that we were not now
likely to find any new argument which could be used. I could have hoped that we would have succeeded in these discussions in converting hon. and right hon. Gentlemen opposite to our proposals, but, at any rate, we hold the opinion that these duties should be imposed. We have debated the matter at length on Second Reading, in Committee, and now on Report. If, after all this labour and argument we are not yet in complete unity, I fear there is absolutely nothing for it but to carry the quarrel and the differences to the supreme arbitrament of a Division.

Captain BENN: In the speech which he has just delivered the Chancellor of the Exchequer has defended himself with what I may call, I hope without offence, a degree of shamelessness. He knows perfectly well that this tax is a protective tax, intended to be a protective tax. I do not agree with the hon. Member for Poplar (Mr. March) that the consumer is not going to pay this tax. I think when that hon. Gentleman spoke about commercial vehicles he intended to refer to luxury vehicles. All I was thinking of was the vehicle which carries round commodities for retail sale, which carries people to and from work; and in this respect it can be shown that the tax on this vehicle, like all protective taxes, is borne by the consumer, and mostly by the poorer consumer. It is quite well known that the importer pays the tax. If there is doubt about some things, there is no doubt about that. The fact of the matter is the right hon. Gentleman introduced this as Protection to please his Protectionist friends. He said the other night that no new arguments had been advanced, but he himself has defended this on an entirely new ground. He explained that the position had been brought about by the march of events—that march of events which leads him from one side to the other. He defends this tax on the grounds, first of all, that it is part of the McKenna Duties. It was never part of the McKenna Duties, and had nothing whatever to do with them. It was specifically excluded from the McKenna Duties. So far as that argument is concerned it has no bearing upon the matter. The right hon. Gentleman defended the McKenna Duties themselves on grounds that were absolutely false, and demonstrably false,
and which had been repeatedly shown to be false in the Debates in this House.
After the War there was a Coalition Government composed of members of the Labour, Liberal and Conservative parties. There were Free Trade Members in it, and Protectionist Members. There was a shortage of tonnage. The Cabinet decided to impose the duties, the purpose of which, it was stated, was to restrict imports, and not to give protection to any industry—to restrict imports and particularly luxuries.

Mr. CHURCHILL: And to raise revenue!

Captain BENN: There were some who thought there was a danger of the duties being used for the purpose of introducing Protection into this country, but they, though they had qualms, had also patriotism, and they had the courage not to press their objections. Now the Chancellor is taking advantage of that. The argument he is using is not a very worthy one. In addition, however, to the Members of the Cabinet being patriotic they were also cautious, and the then Leader of the House, the late Mr. Bonar Law, when he introduced these duties—and when doubt was expressed from the back benches—used these words:
These were duties which never in any circumstances would be kept on after the conclusion of the War.
That being so, what becomes of the Chancellor's flimsy defence that this is merely carrying out the policy of the McKenna Duties, in which he himself took part—

Mr. CHURCHILL: And the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George).

Captain BENN: Yes, and it was a great error of judgment on my part if I omitted to mention him. He goes on to say that if when he is seeking revenue certain effects follow which please his supporters, why is he to be blamed for that? As long as he gets revenue he is justified. Suppose a proposal were brought forward to put a duty on wheat. Would the Chancellor of the Exchequer say, "As long as I can get revenue by putting a duty on wheat the fact that there are corollaries such as the protection of agriculture and a rise in the cost of the food of the people has nothing to do with me. I am merely a man seeking revenue. I have forsaken none of the principles which were set out in the volume quoted by my hon. Friend and so interestingly adorned on the cover." The fact is, these duties do mark a distinct departure. We know the Government are at heart Protectionists, and we know the party behind them are Protectionists, but never before have we had naked uncamouflaged Protection presented to us. This case will be quoted as the beginning of a policy which ultimately will land us in a general tariff, and even to-day, small and apparently unimportant as it is, it is a distinct violation of the pledge given by the Prime Minister.
Question put, "That the words proposed to be left out to the word 'May,' in page 2, line 22, stand part of the Bill."

The House divided: Ayes, 211; Noes, 120.

Division No. 327.]
AYES.
[8.27 p.m.


Agg-Gardner, Rt. Hon. Sir James T.
Briscoe, Richard George
Colfax, Major Wm. Phillips


Alexander, E. E. (Leyton)
Brittain, Sir Harry
Conway, Sir W. Martin


Allen, J. Sandeman (L'pool, W. Derby)
Brocklebank, C. E. R.
Cooper, A. Duff


Ashley, Lt.-Col. Rt. Hon. Wilfrid W.
Brooke, Brigadier-General C. R. I.
Cope, Major William


Astbury, Lieut.-Commander F. W.
Brown, Col. D. C. (N'th'I'd., Hexham)
Couper, J. B.


Balfour, George (Hampstead)
Brown, Brig.-Gen. H. C. (Berks, Newb'y)
Craig, Ernest (Chester, Crewe)


Barclay-Harvey, C. M.
Burgoyne, Lieut.-colonel Sir Alan
Crooke. J. Smedley (Deritend)


Barnston, Major Sir Harry
Burman, J. B.
Crookshank, Col. C. de W. (Berwick)


Beamish, Captain T. P. H.
Burney, Lieut.-Com. Charles D.
Crookshank, Cpt. H.(Lindsey,Gainsbro)


Beliairs, Commander Canlyon W.
Burton, Colonel H. W.
Cunliffe, Sir Herbert


Bennett, A. J
Cadogan, Major Hon. Edward
Curtis-Bennett, Sir Henry


Berry, Sir George
Caine, Gordon Hall
Dalkeith, Earl of


Bethel, A.
Cassels, J. D.
Davidson, Major-General Sir John H.


Betterton, Henry B.
Cautley, Sir Henry S.
Davies, Dr. Vernon


Birchall, Major J. Dearman
Cayzer, Sir C. (Chester, City)
Davies, Sir Thomas (Cirencester)


Bird, Sir R. B. (Wolverhampton, W.)
Chadwick, Sir Robert Burton
Dawson, Sir Philip


Blades, Sir George Rowland
Charteris, Brigadier-General J.
Drewe, C.


Blundell, F. N.
Churchill, Rt. Hon. Winston Spencer
Edmondson, Major A. J.


Boothby, R. J. G.
Churchman, Sir Arthur C.
Elliot, Major Walter E.


Bourne, Captain Robert Croft
Clarry, Reginald George
Ellis, R. G.


Bowyer, Captain G. E. W.
Clayton G. C.
Everard, W. Lindsay


Braithwaite, A. N.
Cobb, Sir Cyril
Falle, Sir Bertram G.


Briggs, J. Harold
Cochrane, Commander Hon. A. D.
Fanshawe, Commander G. D.


Fermoy, Lord
Locker-Lampson, G. (Wood Green)
Sanderson, Sir Frank


Fielden, E. B.
Lougher, L.
Shaw, R. G. (Yorks, W.R., Sowerby


Forestler-Walker, Sir L.
Lucas-Tooth, Sir Hugh Vere
Shaw, Lt.-Col. A. D. Mcl. (Renfrew, W)


Foxcroft, Captain C. T.
Luce, Major-Gen. Sir Richard Harman
Shaw, Capt. W. W. (Wilts, Westb'y)


Fraser, Captain Ian
MacAndrew, Major Charles Glen
Shepperson, E. W.


Frece, Sir Walter de
Macdonald, Capt. P. D. (I. of W.)
Simms, Dr. John M. (Co. Down)


Gadle, Lieut.-Colonel Anthony
Macdonald, R. (Glasgow, Cathcart)
Slangy, Major P. Kenyon


Galbraith, J. F. W.
McDonnell, Colonel Hon. Angus
Smith-Carington, Neville W.


Gault, Lieut.-Cot. Andrew Hamilton
McLean, Major A.
Somerville, A. A. (Windsor)


Gibbs, Col. Rt. Hon. George Abraham
Macmillan, Captain H.
Stanley, Hon. O. F. G. (Westm'eland)


Gilmour, Lt.-Col. Rt. Hon. Sir John
Macnaghten, Hon. Sir Malcolm
Steel, Major Samuel Strang


Glyn, Major R. G. C.
McNeill, Rt. Hon. Ronald John
Storry-Deans, R.


Goff, Sir Park
Maitland, Sir Arthur D. Steel
Stott, Lieut.-Colonel W. H.


Grenfell, Edward C. (City of London)
Malone, Major P. B.
Streatfeild, Captain S. R.


Grotrian, H. Brent.
Margesson, Captain D.
Stuart, Crichton-, Lord C.


Gunston, Captain D. W.
Meller, R. J.
Stuart, Hon. J. (Moray and Nairn)


Hall, Lieut.-Col. Sir F. (Dulwich)
Merriman, F. B.
Styles, Captain H. Waiter


Hammerstey, S. S.
Meyer, Sir Frank
Sugden, Sir Wilfrid


Hannon, Patrick Joseph Henry
Milne, J. S. Wardlaw-
Templeton, W. P.


Harland, A.
Mitchell, S. (Lanark, Lanark)
Thom, Lt.-Col. J. G. (Dumbarton)


Harmsworth, Hon. E. C. (Kent)
Mitchell, W. Foot (Saffron Walden)
Thomson, F. C. (Aberdeen, S.)


Harvey, Major S. E. (Devon, Totnes)
Monsell, Eyres, Com. Rt. Hon. B. M.
Tinne, J. A.


Haslam, Henry C.
Moreing, Captain A. H.
Titchfield, Major the Marquess of


Henderson, Lieut.-Col. V. L. (Bootie)
Morrison-Bell, Sir Arthur Clive
Tryon, Rt. Hon. George Clement


Hennessy, Major J. R. G.
Nall, Lieut.-Colonel Sir Joseph
Turton, Sir Edmund Russborough


Hills, Major John Waller
O'Connor, T. J. (Bedford, Luton)
Vaughan-Morgan, Col. K. P.


Hope, Capt. A. O. j. (Warw'k, Nun.)
Oman, Sir Charles William C.
Waddington, R.


Hope, Sir Harry (Forfar)
Pennefather, Sir John
Wallace, Captain D. E.


Hopkins, J. W. W.
Percy, Lord Eustace (Hastings)
Warrender, Sir Victor


Hopkinson, Sir A. (Eng. Universities)
Perkins, Colonel E. K.
Waterhouse, Captain Charles


Horlick, Lieut.-Colonel J. N.
Perring, Sir William George
Watson, Sir F. (Pudsey and Otley)


Howard, Captain Hon. Donald
Pielou, D. P.
Watson, Rt. Hon. W. (Carlisle)


Hudson, R. S. (Cumberl'nd, Whiteh'n)
Pilditch, Sir Philip
Watts, Dr. T.


Hume, Sir G. H.
Preston, William
Wells, S. R.


Hunter-Weston, Lt.-Gen. Sir Aylmer
Price, Major C. W. M.
Wheler, Major Sir Granville C. H.


Huntingfield, Lord
Radford, E. A.
Williams, Com. C. (Devon, Torquay)


Hurd, Percy A.
Raine, W.
Williams, Herbert G. (Reading)


Hurst, Gerald B.
Ramsden, E.
Wilson, R. R. (Stafford, Lichfield)


Hutchison, G.A. Clark(Midl'n & P'bl's)
Rawson, Sir Cooper
Winterton, Rt. Hon. Earl


Jacob, A. E.
Rees, Sir Beddoe
Wise, Sir Fredric


James, Lieut.-Colonel Hon. Cuthbert
Remer, J. R.
Womersley. W. J.


Jephcott, A. R.
Rentoul, G. S.
Wood, E. (Chest'r, Stalyb'ge & Hyde)


Jones, G. W. H. (Stoke Newington)
Rice, Sir Frederick
Worthington-Evans, Rt. Hon. Sir L.


Kennedy, A. R. (Preston)
Roberts, E. H. G. (Flint)
Wragg, Herbert


Kidd, J. (Linlithgow)
Ropner, Major L.



Kindersley, Major Guy M.
Russell, Alexander West (Tynemouth)
TELLERS FOR THE AYES.—


King, Captain Henry Douglas
Rye, F. G.
Captain Viscount Curzon and


Lister, Cunliffe-, Rt. Hon. Sir Philip
Samuel, A. M. (Surrey, Farnham)
Lord Stanley.


Little, Dr. E. Graham
Sandeman, A. Stewart



NOES.


Adamson, Rt. Hon. W. (Fife, West)
Gibbins, Joseph
Lee, F.


Alexander, A. V. (Sheffield, Hillsbro')
Gillett, George M.
Lindley, F. W.


Ammon, Charles George
Gosling, Harry
Livingstone, A. M.


Attlee, Clement Richard
Graham, D. M. (Lanark, Hamilton)
Lunn, William


Baker, J. (Wolverhampton, Bilston)
Graham, Rt. Hon. Wm. (Edin., Cent.)
Maclean, Neil (Glasgow, Govan)


Barker, G. (Monmouth, Abertillery)
Greenall, T.
March, S.


Barr, J.
Greenwood, A. (Nelson and Coine)
Mitchell, E. Rosslyn (Paisley)


Batey, Joseph
Grenfell. D. R (Glamorgan)
Montague, Frederick


Benn, Captain Wedgwood (Leith)
Groves, T.
Morris, R. H.


Bowerman, Rt. Hon. Charles W.
Grundy, T. W.
Murnin, H.


Broad, F. A.
Hall, F. (York, W.R., Normanton)
Oliver, George Harold


Bromfield, William
Hall, G. H. (Merthyr Tydvil)
Palin, John Henry


Bromley, J.
Hardie, George D.
Paling, W.


Brown, James (Ayr and Bute)
Heyday, Arthur
Parkinson, John Allen (Wigan)


Buchanan, G.
Hayes, John Henry
Pethick-Lawrence, F. W.


Buxton, Rt. Hon. Noet
Henderson, Rt. Hon. A. (Burnley)
Ponsonby, Arthur


Charleton, H. C.
Henderson, T. (Glasgow)
Potts, John S.


Clowes, S.
Hirst, G. H.
Purcell, A. A.


Clase, W. S.
Hirst, W. (Bradford, South)
Richardson, R. (Houghton-le-Spring)


Clynes, Right Hon. John R.
Hudson, J. H. (Huddersfield)
Riley, Ben


Collins, Sir Godfrey (Greenock)
Jenkins, W. (Glamorgan, Neath)
Salter, Or. Alfred


Compton, Joseph
John, William (Rhondda, West)
Scrymgeour, E.


Cove, W. G.
Johnston, Thomas (Dundee)
Scurr, John


Cowan, D M. (Scottish Universities)
Jones, Henry Haydn (Merianeth)
Shaw, Rt. Hon. Thomas (Preston)


Dalton, Hugh
Jones, Morgan (Caerphilly)
Short, Alfred (Wednesbury)


Davies, Rhys John (Westhoughton)
Jones, T. I. Mardy (Pontypridd)
Sinclair, Major Sir A. (Caithness)


Day, Colonel Harry
Kelly, W. T.
Sitch, Charles H.


Dennison. R.
Kennedy, T.
Smillie, Robert


Duncan, C
Kirkwood, D
Smith, Ben (Bermondsey, Rotherhithe)


Dunnico, H.
Lansbury, George
Smith, H. B. Lees (Keighley)


Forrest, W.
Lawrence, Susan
Smith, Rennie (Penistone)


Gardner, J. P.
Lawson, John James
Snell, Harry




Snowden, Rt. Hon. Philip
Tinker, John Joseph
Wilkinson, Ellen C.


Spencer, G. A. (Broxtowe)
Townend, A. E.
Williams, C. P. (Denbigh, Wrexham)


Stamford, T. W.
Viant, S. P.
Williams, David (Swansea, E.)


Stephen, Campbell
Wallhead, Richard C.
Williams, Dr. J. H. (Llanelly)


Stewart, J. (St. Roflox)
Walsh, Rt. Hon. Stephen
Williams, T. (York, Don Valley)


Sullivan, J.
Watson, W. M. (Dunfermline)
Wilson, R. J. (Jarrow)


Sutton, J. E.
Webb, Rt. Hon. Sidney



Thorne, G. R. (Wolverhampton, E.)
Welsh, J. C.
TELLERS FOR THE NOES —


Thurtle, E.
Wiggins, William Martin
Mr. Charles Edwards and Mr. A. Barnes.

Mr. ALEXANDER: I beg to move, in page 2, line 22, to leave out the word "May" and to insert instead thereof the word "June."
This is not an Amendment which covers a wide area but is one which must impress itself on the Government as offering the opportunity for making a valuable concession. The effect of the Budget Resolutions now made statutory by the Clause we are discussing, is that people who had chassis, whether assembled or to be assembled, on order, to arrive here, say, in the first fortnight in May are going to be severely handicapped. I have seen correspondence from some firms, small firms especially, from which it appears that they will be faced not merely with immediate financial loss but possible bankruptcy because of the cancellation of orders. It has been said that this proposal is not likely to raise the price of commercial cars, but that is a very curious argument for the Chancellor of the Exchequer to use. I have seen communications from him which were sent to a representative of the Chamber of Commerce who asked for some consideration in regard to this duty in which it was stated that where the effect of the duty on imported chassis was such as to preclude their sale and involve the importer in loss, he would have the right under the Act of 1901 to claim the amount of that duty as an extra from his customer. Yet the Chancellor of the Exchequer said that this duty was not calculated to increase the price.
In the case of people involved in a loss of this kind I want to point out that it is a well-known fact in the trade that where a contract has been made for the purchase of a vehicle of this character it is generally on the basis of there being an option on the part of the customer to cancel the contract if within seven days there should be an increase of price not contemplated when the contract was entered into. There is nothing in the Act of 1901 which would enable the importer of commercial chassis during the
first month of the operation of this duty to recoup himself against his losses. I cannot imagine the party opposite wishing to see any serious damage done to trade by the operation of this duty. I have seen the actual correspondence from some firms who fear that they are quite likely to be faced with bankruptcy on account of the losses they will incur by the operation of this duty. Probably the Financial Secretary to the Treasury and hon. Members opposite would desire to see this duty put on at the very earliest date for Protectionist reasons, but the date is now past, and there would be no possible effect on future imports by putting the date back from the 1st May to the 1st June, so that the people who have been involved in losses, without notice, in the case of orders contracted before the Budget statement might be put into a position of being able to carry on their business. I think that is a reasonable request, and I am hoping the Treasury will see their way to grant it. I am well aware that a large number of people in the trade, whether they deal in cars, chassis or other commodities, are bound to experience great inconvenience and loss by changes in the tariff once you begin to fiddle about with your fiscal system, but we are not making that point on this Amendment. We are simply asking for a concession of a month in order that those adversely affected may be able to put themselves four square.

Mr. J. HUDSON: I beg to second this Amendment.

Mr. McNEILL: The hon. Gentleman who moved this Amendment rather challenged me to say whether I thought that this proposal would inflict serious injury upon trade. I do not think it is necessary to assure him that those sitting on this side of the House have no such desire. On the contrary, any adjustment of taxation or any change which could be made consistently with the principle of the tax itself, and which would have the effect of improving matters as regards
trade, is something which we are inclined to support. It does not follow that because the hon. Member who moved this Amendment was able to quote instances which have been brought to his notice of the inconvenience caused by the actual imposition of a duty of this sort that it is not consistent with the scheme of taxation adopted by the Government and the House to make the particular changes, adjustments or easements to meet the instances he has in mind. The hon. Member pointed out that a trader has a right under the existing law to recoup himself when, unbeknown to him, a duty was imposed, and in order to protect him from loss he has a right under these circumstances to add to the contract price what will recoup him. The hon. Member brings that forward as a proof of the general proposition that the effect of any duty must be to increase the price of the article.
In this matter you cannot lay down any definite lines, because such a thing might happen in some cases and not in others. It is evident from what the hon. Member has said that the importer cannot suffer damage from the duty coming on after he has made his contract. I do not agree that in the cases which the hon. Member has in mind the result under the existing law would involve any serious loss, and probably there would be no loss at all. I venture to say that the traders who used the word "bankruptcy" in talking to the hon. Gentleman opposite were unduly pessimistic as to the effect of this duty. The hon. Member for Hillsborough (Mr. A. V. Alexander) spoke of what he describes as "fiddling about with your fiscal system." I suppose the hon. Member only means a variation of taxation. I suppose the hon. Member would describe any variation of taxation as a fiddling about with your fiscal system. If you take a penny off the Income Tax or put a penny on or even adjust the Death Duties, the hon. Member would say that we were fiddling about with our fiscal system. There is no doubt that there must be a certain amount of inconvenience to those who are affected by the fiddling or the variation. In these circumstances it is not reasonable for the hon. Member to expect, and I do not think he does expect, that we should make a very serious inroad into the
change which we are proposing, and which the Committee has already accepted. We cannot be expected to make a very serious inroad into that for no stronger reason than the hon. Member has brought to our notice.
I cannot say exactly what loss of revenue it would involve, but there would be some loss, and it would mean very serious inconvenience and difficulty in regard to machinery, because it would be necessary to separate from other importations the articles which have been imported during the month which the hon. Gentleman wants to take out, and I am advised that it would be very difficult and inconvenient—I do not say it would be impossible—to carry out that process. It has a still greater disadvantage. It would be a very bad precedent, and it would be practically a precedent which we should be obliged to follow in any future "fiddling with our fiscal system." I expect that in years to come a great deal of that will be done, and by no one more than by the party opposite, and it would be a very serious precedent to set, because, at any time when a duty of any sort was imposed, all that importers would have to do would be to bring in large quantities of goods on the speculation that, on the precedent which we should have accepted here, the date of imposition of the tax would be altered in order to exclude, over a certain period, goods that might have been presumed to be under way or under contract before the duty was imposed. That would be a very unfortunate thing for us to do, and, as I do not see that any sufficiently strong reason has been given to show that there is any real grievance, I must ask the House not to agree to the Amendment.

9.0 P.M.

Captain BENN: There is no question here of discussing any general principle. We are not talking about the merits of a tariff, or the ultimate incidence of taxation, but about a real commercial difficulty and hardship which threatens great injury to some importing firms. It is not a vague case, but a specific case, and I will give the right hon. Gentleman one example—no doubt there are others. I shall be happy to give him the names if he wishes. We are not concerned here with anticipatory dumping. There can be no question of anticipatory dumping, because the tax was fixed as from the 1st May, and became operative
on the date on which it was announced. We are, therefore, dealing with a specific injury which may be done to traders, and I am sure the right hon. Gentleman has no desire either to put traders into bankruptcy or to do any unnecessary damage to any trading concern. The case to which I refer is that of an importer who has 33 commercial chassis in transit from New York, 20 in one ship and 13 in another. They were sold to him under a contract which would have left him a net profit of £40 per chassis. He will now be called upon to pay £110 in tax, and will, therefore, lose £70 on each vehicle. He alleges further that he is going to lose £1,000, and he says that this may drive him out of this importing business, and he will cease to be a contributor to the right hon. Gentleman's taxes. The right hon. Gentleman, surely, does not want that to happen. There is no party division here; it is purely a question of doing an injury to one man, or perhaps 20, or perhaps 50—I do not know. We sacrifice nothing; we assail no principle; we merely ask the right hon. Gentleman to make arrangements such as he has often made before in order to save firms in these matters. I have here a copy of an Order relating to gas mantles and cutlery, where the date was adjusted in order to cover goods in transit to this country.

The right hon. Gentleman has really only one reply in substance. He says that in Section 10 of the Act of 1901 power is given to a firm to add to the purchaser's price the additional duty, and the purchaser, no doubt, will pass it on to the consumer, so that no one will be damnified in the long run. But, in the contract between this man who is importing and his purchaser there is a stipulation that, in case of a rise in price from any cause, the purchaser will have a 10 days' right to cancel the contract. Therefore, this man may be in the position—and that is what he fears—of finding his contract for these 33 vehicles cancelled, in which case he will have to bear the cost, namely, £55 per vehicle, of sending them back to New York. I venture to suggest that I have made out a case which is deserving of careful consideration, and I hope the right hon. Gentleman, even now, will see his way to do in this Clause what he has often done in connection with tax-collecting machinery before, namely, to make such an adjustment that unnecessary harm is not inflicted on people who are trying to carry on their business, and who are quite willing to pay any tax that may be legitimately levied.

Question put, "That the word 'May' stand part of the Bill."

The House divided: Ayes, 214; Noes, 127.

Division No. 328.]
AYES.
[9.3 p.m.


Acland-Troyte, Lieut.-Colonel
Butt, Sir Alfred
Dawson, Sir Philip


Agg-Gardner, Rt. Hon. Sir James T.
Cadogan, Major Hon. Edward
Drewe, C.


Alexander, E. E. (Leyton)
Caine, Gordon Hall
Edmondson, Major A. J.


Allen, J. Sandeman (L'pool, W. Derby)
Cassels, J D.
Edwards, J. Hugh (Accrington)


Ashley, Lt.-Col. Rt. Hon. Wilfrid W.
Cautley, Sir Henry S.
Elliot, Major Walter E.


Astbury, Lieut.-Commander F. W.
Cayzer, Sir C. (Chester, City)
Ellis, R. G.


Balfour, George (Hampstead)
Chadwick, Sir Robert Burton
England, Colonel A.


Barclay-Harvey, C. M.
Charteris, Brigadier-General J.
Everard, W. Lindsay


Barnston, Major Sir Harry
Churchman, Sir Arthur C.
Falle, Sir Bertram G.


Beamish, Captain T. P. H.
Clarry, Reginald George
Fanshawe, Commander G. D.


Bennett, A. J.
Clayton, G. C.
Fermoy, Lord


Berry, Sir George
Cobb. Sir Cyril
Fielden, E. B.


Bethel, A.
Cochrane, Commander Hon. A. D.
Forestier-Walker, Sir L.


Betterton, Henry B.
Colfox, Major Wm. Phillips
Foster, Sir Harry S.


Birchall, Major J. Dearman
Conway, Sir W. Martin
Foxcroft, Captain C. T.


Bird, Sir R. B. (Wolverhampton, W.)
Cooper, A. Duff
Fraser, Captain Ian


Blades, Sir George Rowland
Cope, Major William
Frece, Sir Walter de


Blundell, F. N.
Cooper, J. B.
Gadie, Lieut.-Col. Anthony


Boothby, R. J. G.
Courtauld, Major J. S.
Galbraith, J. F. W.


Bourne, Captain Robert Croft
Cowan, Sir Wm. Henry (Islingtn. N.)
Gault, Lieut.-Col. Andrew Hamilton


Braithwaite, A. N.
Craig, Ernest (Chester, Crewe)
Gibbs, Col. Rt. Hon. George Abraham


Briggs, J. Harold
Crooke, J. Smedley (Deritend)
Gilmour, Lt.-Cal. Rt. Hon. Sir John


Briscoe, Richard George
Crookshank, Col. C. de W. (Berwick)
Glyn, Major R. G. C.


Brocklebank, C. E. R.
Crookshank, Cpt. H.(Lindsey,Galnsbro)
Goff, Sir Park


Brooke, Brigadier-General C. R. I.
Cunliffe, Sir Herbert
Grenfell, Edward C. (City of London)


Brown, Col. D. C. (N'th'I'd., Hexham)
Curtis-Bennett, Sir Henry
Grotrian, H. Brent


Brown, Brig.-Gen. H.C.(Berks, Newb'y)
Dalkeith, Earl of
Gunston, Captain D.


Burgoyne, Lieut.-Colonel Sir Alan
Dalziel, Sir Davison
Hall, Lieut.-Col. Sir F. (Dulwich)


Burman, J. B.
Davidson, Major-General Sir John H.
Hammersley, S. S.


Burney, Lieut.-Com. Charles D.
Davies, Dr. Vernon
Hannon, Patrick Joseph Henry


Burton, Colonel H. W.
Davies, Sir Thomas (Cirencester)
Harland, A.


Harmsworth, Hon. E. C. (Kent)
Margesson, Captain D.
Smith-Carington, Neville W.


Harrison, G. J. C.
Meller. R. J.
Somerville, A. A. (Windsor)


Harvey, Major S. E. (Devon, Totnes)
Merriman, F. B.
Stanley, Lord (Fylde)


Haslam, Henry C.
Meyer, Sir Frank
Stanley, Hon. O. F. G.(Westm'eland)


Henderson, Lieut.-Col. V. L. (Bootie)
Milne, J. S. Wardlaw-
Steel, Major Samuel Strang


Hennessy, Major J. R. G.
Mitchell, S. (Lanark, Lanark)
Storry-Deans, R.


Herbert, S. (York, N.R.,Sear. & Wh'by)
Monsell, Eyres, Com. Rt. Hon. B. M.
Stott, Lieut.-Colonel W. H.


Hope, Capt. A. O. J. (Warw'k, Nun.)
Moreing, Captain A. H.
Streatfeild, Captain S. R.


Hope, Sir Harry (Forfar)
Morrison-Bell, Sir Arthur Clive
Stuart, Crichton-, Lord C.


Hopkins, J. W. W.
Nall, Lieut.-Colonel Sir Joseph
Stuart, Hon. J. (Moray and Nairn)


Hopkinson, Sir A. (Eng. Universities)
Neville, R. J.
Styles, Captain H. Walter


Hopkinson, A. (Lancaster, Mossley)
O'Connor, T. J. (Bedford, Luton)
Sugden, Sir Wilfrid


Horlick, Lieut.-Colonel J. N.
Oman, Sir Charles William C.
Templeton, W. P.


Howard, Captain Hon. Donald
Pennefather, Sir John
Thom, Lt.-Col. J. G. (Dumbarton)


Hudson, R. S. (Cumberl'nd, Whiteh'n)
Percy, Lord Eustace (Hastings)
Thomson, F. C. (Aberdeen, South)


Hume, Sir G. H.
Perkins, Colonel E. K.
Tinne, J. A.


Hunter-Weston, Lt.-Gen. Sir Aylmer
Perring, Sir William George
Titchfieid, Major the Marquess of


Huntingfield, Lord
Pielou, D. P.
Tryon, Rt. Hon. George Clement


Hurd, Percy A.
Pilditch, Sir Philip
Turton, Sir Edmund Russborough


Hurst, Gerald B.
Preston, William
Vaughan-Morgan. Col. K. P.


Hutchison, G. A. Clark (Midl'n & P'bl's)
Price, Major C. W. M.
Waddington, R.


Jackson, Sir H. (Wandsworth, Cen'l)
Radford, E. A.
Wallace, Captain D. E.


Jacob, A. E.
Raine, W.
Warrender, Sir Victor


James, Lieut.-Colonel Hon- Cuthbert
Ramsden, E.
Waterhouse, Captain Charles


Jephcott, A. R.
Rawson, Sir Copper
Watson, Sir F. (Pudsey and Otley)


Kennedy, A. R. (Preston)
Rees, Sir Beddoe
Watson, Rt. Hon, W. (Carlisle)


Kidd, J. (Linlithgow)
Remer, J. R.
Watts, Dr. T.


Kindersley, Major Guy M.
Rice, Sir Frederick
Wells, S. R.


King, Captain Henry Douglas
Roberts, E. H. G. (Flint)
Wheler, Major Sir Granville C. H.


Little, Dr. E. Graham
Ropner, Major L.
Williams, Com. C. (Devon, Torquay)


Locker-Lampson, G. (Wood Green)
Russell, Alexander West (Tynemouth)
Williams, Herbert G. (Reading)


Lougher, L.
Rye, F. G.
Wilson, R. R. (Stafford, Lichfield)


Lucas-Tooth, Sir Huth Vere
Samuel, A. M. (Surrey, Farnham)
Winterton, Rt. Hon. Earl


Luce, Maj.-Gen. Sir Richard Harman
Sandeman, A. Stewart
Wise, Sir Fredric


MacAndrew, Major Charles Glen
Sanderson, Sir Frank
Womersley, W. J.


Macdonald, Capt. P. D. (I. of W.)
Shaw. R. G. (Yorks, W.R., Sowerby)
Wood, E. (Chest'r, Stalyb'ge & Hyde)


Macdonald, R. (Glasgow, Cathcart)
Shaw, Lt.-Col. A. D. Mcl. (Renfrew, W)
Wragg, Herbert


McDonnell, Colonel Hon. Angus
Shaw, Capt. W. W. (Wilts, Westb'y)



McLean, Major A.
Sheffield, Sir Berkeley
TELLERS FOR THE AYES.—


Macnaghten, Hon. Sir Malcolm
Shepperson, E. W.
Captain Bowyer and Captain


McNeill, Rt. Hon. Ronald John
Simms, Dr. John M. (Co. Down)
Viscount Curzon.


Malone, Major P. B.
Slaney, Major P. Kenyon



NOES.


Adamson, Rt. Hon. W. (Fife, West)
Graham. Rt. Hon. Wm. (Edin., Cent.)
Morris, R. H.


Alexander, A. V. (Sheffield, Hillsbro)
Greenall, T.
Murnin, H.


Ammon, Charles George
Greenwood, A. (Nelson and Colne)
Naylor, T. E.


Attlee, Clement Richard
Grenfell, D. R. (Glamorgan)
Oliver, George Harold


Baker, J. (Wolverhamlon, Bilstan)
Groves, T.
Palin, John Henry


Barker, G. (Monmouth, Abertillery)
Grundy, T. W.
Paling, W.


Barnes, A. 
Hall, F. (York, W.R. Normanton)
Pethick-Lawrence, F. W.


Barr, J.
Hall, G. H. (Merthyr Tydvil)
Ponsonby, Arthur


Batey, Joseph
Hardie, George D.
Potts, John S.


Benn, Captain Wedgwood (Leith)
Harris, Percy A.
Purcell, A. A.


Bowerman, Rt. Hon. Charles W.
Hayday, Arthur
Richardson. R. (Houghton-le-Spring)


Broad, F. A.
Hayes, John Henry
Riley, Ben


Bromfield, William
Henderson, Right Hon. A. (Burnley)
Robinson, Sir T. (Lanes, Stretford)


Bromley, J.
Henderson, T. (Glasgow)
Runciman, Rt. Hon. Walter


Brown, James (Ayr and Bute)
Hirst, G. H.
Salter, Dr. Alfred


Buchanan, G.
Hirst, W. (Bradford, South)
Scrymgeour, E.


Buxton, Rt. Hon. Noel
Hudson, J. H. (Huddersfield)
Scurr, John


Charleten, H. C.
Jenkins, W. (Glamorgan, Neath)
Shaw, Rt. Hon. Thomas (Preston)


Clowes, S.
John, William (Rhondda, West)
Shepherd, Arthur Lewis


Cluse, W. S.
Johnston, Thomas (Dundee)
Short, Alfred (Wednesbury)


Clynes, Rt. Hon. John R.
Jones, Henry Haydn (Merloneth)
Sinclair, Major Sir A. (Calthness)


Compton, Joseph
Jones, Morgan (Caerphilly)
Sitch, Charles H.


Cove, W. G.
Kelly, W. T.
Slesser, Sir Henry H.


Cowan, D. M. (Scottish Universities)
Kennedy, T.
Smillie, Robert


Dalton, Hugh
Kirkwood, D
Smith, Ben (Bermondsey, Rotherhithe)


Davies, Evan (Ebbw Vale)
Lansbury, George
Smith, H. B. Lees (Keighley)


Davies, Rhys John (Westhoughton)
Lawrence, Susan
Smith, Rennie (Penistone)


Day, Colonel Harry
Lawson, John James
Snell, Harry


Dennison, R.
Lee, F.
Snowden, Rt. Hon. Philip


Duncan, C.
Lindley, F. W.
Spencer. G. A. (Broxtowe)


Dunnico, H.
Livingstone, A. M.
Stamford, T. W.


Forrest, W.
Lowth, T.
Stephen, Campbell


Gardner, J. P.
Lunn, William
Stewart, J. (St. Rollox)


Gibbins, Joseph
Maclean, Neil (Glasgow, Govan)
Sullivan, J.


Gillett, George M.
March, S.
Sutton, J. E.


Gosling, Harry
Mitchell, E. Rosslyn (Paisley)
Thorne, G. R. (Wolverhampton, E)


Graham, D. M. (Lanark, Hamilton)
Montague, Frederick
Thurtle, E.




Tinker, John Joseph
Webb, Rt. Hon. Sidney
Williams, T. (York, Don Valley)


Townend, A. E.
Welsh, J. C.
Wilson, R. J. (Jarrow)


Trevelyan, Rt. Hon. C. P.
Wiggins, William Martin



Vlant, S. P.
Wilkinson, Ellen C.
TELLERS FOR THE NOES.—


Wallhead, Richard C.
Williams, C. P. (Denbigh, Wrexham)
Mr. Allen Parkinson and Mr.


Walsh, Rt. Hon. Stephen
Williams, David (Swansea, East)
Charles Edwards.


Watson, W. M. (Dunfermline)
Williams, Dr. J. H. (Llanelly)

Orders of the Day — CLAUSE 6.—(Provisions for securing Customs and Excise duties imposed by Ways and Means Resolutions not having statutory effect.)

Captain BENN: I wish to move one of my Amendments to this Clause if you will be good enough to indicate which, so as not to prejudice the other Amendments on the Paper.

Mr. DEPUTY-SPEAKER: I presume the last, but in that case I will call on the hon. Member for Hillsborough (Mr. A. V. Alexander) first.

Captain BENN: I have a prior one to that.

Mr. DEPUTY-SPEAKER: It is for the hon. and gallant Gentleman to say. If the last is the one to which he attaches most importance I will call on him after calling on the hon. Member for Hillsborough.

Captain BENN: I suggest I should be allowed to move the earlier one and perhaps that would allow of a general discussion on the merits of the question.

Mr. DEPUTY-SPEAKER: If the hon. and gallant Gentleman wishes to move it, there is nothing to prevent him.

Mr. ALEXANDER: Would it not be convenient for the hon. and gallant Gentleman to move to leave out the Clause?

Mr. DEPUTY-SPEAKER: I am quite willing to allow that.

Captain BENN: I beg to move to leave out the Clause.
This Clause so far has not been the subject of any comment during our discussions, and as it raises some points of considerable interest I will ask the patience of the House while I remind hon. Members what it does. It. gives the Treasury the power to require traders, in respect of any new Customs or Excise Duties, to give security pending the passage of any Act of Parliament. We are making here an alteration in the practice of Parliament with regard to taxa-
tion, and such an amendment of the law naturally is of the very greatest importance to all of us. It is not necessary to go back to the Act of Edward I to discuss the merits of the Clause, but we must go back to the Bill of Rights, because the Clause represents an extension of an Act of 1913 which itself was passed because of an infringement of the Bill of Rights. It has been the practice for 80 or 90 years for the Treasury officials, immediately a Ways and Means Resolution has been passed, to start the collection of the tax. The reason is obvious, because they wish not to allow evasion by people passing things
through the Customs or Excise in anticipation of the duty. A very distinguished Member of the House, Mr. Gibson Bowles, who was also a stickler for Parliamentary propriety, brought an action against the Bank of England in 1912 or 1913, and Lord Parker decided that the Bill of Rights had been infringed and that Mr. Bowles was right when he denied that the Treasury were entitled to collect his Income Tax before there was an Act on the Statute Book giving them the right to collect it. Under that judgment, called the Bowles judgment, the whole practice of 80 or 90 years toppled down, and the Treasury found itself without the power to collect taxes until the Bill had passed the House of Commons.
The result of that judgment was she introduction of the Provisional Collection of Taxes Bill in 1913. The Chancellor of the Exchequer, with his admirable debating skill, will perhaps point out that that Bill was passed by the Liberal party. The right hon. Member for Carnarvon Boroughs (Mr. Lloyd George), who was Chancellor of the Exchequer at that time, advocated the Bill in the widest possible sense. It provided that in future, once a Ways and Means Resolution had been passed, it should have the force of law. Certain hon. Members resented the wide terms of the Bill. To do my right hon. Friend justice, he recognised at the earliest possible stage, namely, in Committee of Ways and Means, when passing the Resolution on
which the Bill was to be founded, the force of the criticism, and said that he would meet it on two points—(1) that he would not permit new taxes to be collected on a Ways and Means Resolution, and, further, in reply to the Noble Lord the Member for Oxford University (Lord H. Cecil), he said he recognised that such Resolution must be subject to a time limit. He said that we could not have a Ways and Means Resolution going on as though it were an Act of Parliament, although it might be right and proper to give it the force of an Act of Parliament until the Act of Parliament was passed.
Even this modified Bill, with the two elements of the exclusion of new taxes and the introduction of a time limit, was very fiercely assailed by some hon. Members. The present Home Secretary was very prominent among the opponents, and also the present Minister of Labour. The present Home Secretary declared that he was going to devote his life to a defence of the rights of the subject. That only shows, as the Chancellor of the Exchequer would say, that the march of events make changes in the careers of all of us. The present Foreign Secretary, speaking as an ex-Chancellor of the Exchequer, and leading the financial criticism of the Bill from the Opposition side of the House, started by being a friend of the Bill, but said that it must include the collection of new taxes, and that if it did not include new taxes, he would oppose it on Third Reading. When new taxes were excluded, on the motion of the Member for Bow and Bromley at that time (Mr. Murray Macdonald), the present Foreign Secretary became an opponent of the Bill, and voted against the Third Reading. He wanted new taxes to be included because he saw in it a tariff weapon. He saw the advantage of being able by Ways and Means Resolution to impose Customs Duties on incoming goods, and when the new taxes were excluded from the scope of the Bill, he became an opponent of the Measure. There was a sharp conflict also between the Chair and the then Member for Central Sheffield.
The Clause as it stands to-day may be defended on some grounds which, perhaps, will commend themselves to hon. Members above the Gangway on this side of the House. Mr. Swift MacNeill, who took
part in the Debate to which I am referring, declared that the House had the power, if it willed, to pass the whole Budget by one Resolution. He said, "We have the power, if we wish, to pass a whole Act of Parliament by one Resolution." He had in mind the passage of Bills under the Parliament, Act. He said that Mr. Gladstone had once declared that he would pass the whole Budget with the Speaker in the Chair, because Mr. Arthur O'Connor had put down a Motion to prevent Mr. Speaker leaving the Chair in order to prevent the House going into Committee. From that point of view there may be something to be said for the glorification of the power of a single Resolution of the House of Commons, but, on the other hand, there is more to be said against the Clause.
First of all, it introduces into the Statute the Rules and Procedure of this House. I dare say the Financial Secretary for the Treasury may point out that in some existing Statutes the words "Ways and Means Committee" do occur, but if we are to remain masters of our own procedure, we surely do not wish to stereotype it by making it the subject of decisions by Courts of Law. The Courts can decide by the printed Votes and Proceedings of this House, but, even so, there are certain difficulties. There is an objection that we ourselves should decide our own procedure, outside our own Budget, and there is the further objection that a Judge might have difficulty in getting positive proof that this Resolution of Ways and Means has, in fact, been passed. That is a technical difficulty. The difficulty of substance and the objection of substance is this, that this Clause strengthens the power of the Executive. It means to say that the subject who has to pay the tax is at the mercy of the Executive, which can come down to the House and move a Resolution in Ways and Means and, thereupon, demand for that Resolution the force of law. We know quite well that in Committee of Ways and Means no notice is given of a Resolution. When we come to the Budget, nobody knows what the Chancellor of the Exchequer will say when he opens his red box, because he desires to have no anticipation of any proposals by commercial concerns. If we pass such a Clause, which gives to Ways and Means Committee the right by a single Resolution to make the law,
we do subject the public to something which may come upon the House by surprise. For that reason, the present Home Secretary and the present Minister of Labour opposed very strongly the Provisional Collection of Taxes Bill and demanded that all the safeguards of full Parliamentary procedure should be completely honoured.
The Financial Secretary to the Treasury will say that this is making a mountain out of a mole-hill. He will say that in this Bill we are not asking people to pay taxes under Sub-section (2), and we are not asking them to pay Excise Duties under Sub-section (3). He will say that under Sub-section (3) we are merely asking for the power to make regulations, and we are asking for power under Sub-section (2) to require security. In my submission, there is no difference between requiring a man to give security and levying a charge. If he has to give a bond, he must go to the bank or some other institution to get them to go bail for him, and for that financial service he will have to pay. Although it may be a slight thing, it is, nevertheless, a charge laid upon him as a result of this Resolution. I should have submitted even before the Committee stage of this Clause was taken, that it might have been made the subject of a Ways and Means Resolution itself, in as much as it lays a charge upon the subject. Although I am prepared to concede that this is a little thing in itself, it is, in fact, a charge, and a charge which infringes both the precautions which the right hon. Member for Carnarvon Boroughs accepted in 1913 at the instance of the House of Commons, represented by the Noble Lord the Member for Oxford University, and the Liberal Member for Bow and Bromley. Under Sub-section (2) there is no limitation in regard to new taxes; it is extended to new taxes, and there is no limitation of time. If the duty is an Excise Duty, the Commissioners may require the man to give security that he will, if and when the Act comes into operation imposing this duty, pay it. If and when the Act comes into operation, this Resolution, therefore, in this Bill has the force of law. Until when?
Till such time as an Act which imposed the duty may come into force. But when? This year, next year, some time,
this Parliament, next Parliament? When will such an Act come into force? There is absolutely no limitation at all. In that respect this Clause goes far beyond anything that was contemplated in the Provisional Collection of Taxes Act, to which he and his friends take such objection. This power of the Executive to require the taxpayer to give security or, in effect, to incur liability, for that is what giving security means, may be used by the other side for its own advantage. According as we look at it from the point of view of the desire to carry safely the policy we believe in, or if we look at it from the point of view of believing in the power of the House of Commons, whether we are in a majority or a minority, to safeguarding the subject, we shall decide it. If we think it is a useful instrument, we can look at it from both sides. Supposing hon. Gentlemen above the Gangway came into power. Supposing they gave to the House of Commons, by Ways and Means Resolution, the power to require security of all persons with a fortune over £5,000 to pay a Capital Levy, if and when called upon. That commends itself to the hon. Member for Shoreditch (Mr. Thurtle), but I should not be surprised to find that many hon. Gentleman above the Gangway are pleased with the Clause for that reason. When hon. Gentleman opposite had done what they are always saying they will do, namely, restore the financial power of the House of Lords—that is one of the determinations of their programme—there is nothing easier than for hon. Gentlemen above the Gangway to give to a House of Commons Ways and Means Committee Resolution all the force of law.
Take the other side. There is a Committee sitting on hosiery under the auspices of the President of the Board of Trade. We are not allowed to know when it is appointed; we know little about its proceedings; we do not know whether it has reported, and we do not know what the President of the Board of Trade thinks of the Report. He believes in the strictest secrecy in those affairs. Is it reasonable to suggest that he proposes to come down to this House in a few weeks' time, propose a Resolution like this, and snap his fingers at the House of Commons? He does not care when the
Finance Act was passed. This power may be used by the other side on exactly the same Amendment, as it may be used by this side. While I believe in the supremacy of the finance of the House of Commons against any other House, at the same time I believe in the procedure of the House of Commons for arriving, inside the House itself, at the reasonable and considered view of things. Therefore, I say that the House will be very well advised to examine the Clause very carefully before it permits it to take its place on the Statute Book.
The main thing that is required to make the Clause tolerable is to put in a time table. We must say how long this Resolution is to be operative. Therefore, I shall propose in due course a time table taken from the Provisional Collection of Taxes Act, 1913, which says that you may collect your security on the strength of the Ways and Means Resolution, but you must give proof of good faith by reporting the Resolution within so many days, introducing the Finance Bill within so many days, and passing it into law in so many months. I most earnestly ask hon. Gentlemen in all parts of the House to see that the procedure which has been carried out for many centuries should not be tampered with even in a small detail in the way suggested by the present Bill without proper safeguards. Therefore, I ask from the right hon. Gentleman consideration of the point I have made. I beg to move.

Mr. RUNCIMAN: I beg to second the Amendment.
My hon. and gallant Friend has given, with his usual facility, a defence of the common procedure of the House of Commons, which does not require any emphasis from me. I would like to put, for the consideration of the House and of the Financial Secretary, the purely practical difficulty in which he places the taxpayer by pressing the Clause in its present form. In the discussions in 1913, which I remember, and which I think he will remember also, it was pointed out that if the Act went through in its original unamended form it would give the Government of the day power to impose taxation by Resolution and to do it by Resolution in such a way as to dispense with all the later stages in our financial procedure. Moreover, it was
suggested in the course of the Debate in the House that, even if you put a limit on the vitality of that Resolution, the Government of the day would get over the difficulty by passing another Resolution on the expiration of the period, and go on passing Resolutions once every 10 days or three weeks establishing new taxation. It was also pointed out that unless there was some provision taken for an early passage of the Finance Bill itself, that the collection of the taxes might be going on for weeks or for months, and that during the whole of that time the taxpayer would have to provide other taxes or provide some security which he would have to purchase from some institution, presumably his bank. He would be out of pocket during that period, and at the end of it might find that the whole of this had been quite unnecessary, for the Finance Bill itself might not contain the Clause based on the Resolution. The Finance Bill may never be carried, and for various reasons the Resolution may be of no effect.
One of the cases which was put in the House was that the House might be dissolved before the Finance Bill was passed. In that case the Resolution would still go on being sufficient justification for the collection of the duties or the provision of security. If that was done in the case contemplated in the Clause now under discussion, it would mean that under Sub-section (2) it would be possible to impose a Customs duty, and by the passage of the Resolution it would be possible for the Inland Revenue and Customs to go on collecting that Customs Duty or compelling the taxpayer to provide some security for the ultimate payment of that duty, which really means he has to pay for the finance of it meanwhile, if and when the Act comes into operation imposing the duty. Suppose the Act never comes into operation. There is nothing in this Clause which would free the taxpayer from the liability to go on contributing. It would not only be a question of delay for 10 days or three weeks or six weeks or even three months. It might go on throughout the whole of the Parliament. Indeed, as the drafted Clause now stands, he would be liable for the payment of the duty not only during the lifetime of that Parliament, but even if there were a dissolution, he would still
be liable. There might be a complete change of Government. There might possibly be the same Government coming in. It would carry on from one Parliament to another, and would really institute in our financial procedure a precedent for carrying over from one Parliament into another a provision which had been stipulated for, and a stage which had been incomplete, right from one Parliament, past a General Election to an entirely new House, which knew nothing of the original grounds on which the Resolution was based. I am perfectly sure that the Financial Secretary cannot intend that, or that the Chancellor of the Exchequer, who is a much bolder man can ever intend that. I do not think the House of Commons, when it understands this point can possibly accept a proposal of this kind as being sound financial policy. It is contrary to the procedure of the House in the past, and I presume the Financial Secretary will take some time to consider the point, if he has not done so already.
Might I point out how far it was necessary to introduce safeguards in 1913. When the Bill was going through the House various provisions were made for the Resolution not being a substitute for the Act of Parliament. The first thing introduced—it was on the Motion of the Member for Oxford University, and it received support from Mr. Murray Macdonald, who was then a prominert Member of this House—the first provision made was that "the Resolution should cease to have statutory effect if it is not agreed on with or without modification by the House within the next 10 days in which the House sits." There must not be more than 10 days' interval between the passing of the Resolution and the Report stage. The next provision was that if the Bill embodying the Resolution was not read a Second time within 20 days after the passing of the Resolution, the Resolution shall be null and void. There is no limitation of that kind in the proposal now before the House. That was necessary in 1913, and it is just as necessary now, and indeed, as this is to be applied mainly to Customs, it becomes more necessary. The next stage was the provision made in the case of a Dissolution or Prorogation of Parliament.
There is no limitation here that it has to lapse when Parliament is prorogued. The drafting of this Clause is one of the most drastic things ever brought into the House of Commons. The Financial Secretary cannot have refreshed his memory on the procedure when the Bowles Act was going through the House of Commons in 1913 or he would never have been a party to this Clause being drafted in this way.
But is this fair to the taxpayer, apart from the proprieties of Parliamentary procedure? I do not think he wants them to deteriorate. I think he has a great respect for our financial procedure, and does not wish it to be cut down. But from the point of view of the taxpayer, it is impossible for any importer to know where his liability is going to end. He knows when it begins; it begins at the moment the Resolution is passed in Committee of Ways and Means. The Financial Secretary knows that after all a Committee of Ways and Means is only a Committee of this House; it is not the House itself. He knows when it begins, but he has no idea when it is going to end. If the Government delays for many months the final passage of their Finance Bill, he is still liable. If Parliament comes to a sudden end, he has to go on through the whole period, the uncertain period, of a general election, and he does not know when his liability ends. He has to go on visiting his bank, producing guarantees, in order that he may be able to pay up when finally it is passed into an Act of Parliament.
It may go on for a considerable time afterwards. If the new Government which comes in is not so friendly to the Resolution as its original authors that does not free the taxpayer from the liability of having to provide security. He still has to do so. They might not lake the trouble of incorporating the Resolution in their Finance Bill, and still he remains liable; and he may be liable for a period of 18 months and have all these accumulated guarantees to clear off some time or another. The Financial Secretary is aware that if that is done the importer may easily exhaust his credit with his bank. They do not give unlimited guarantees of this kind to their customers without some security, and the amount of security is, of course, limited. In the case of many importers it would restrict their
operation by eating up their capital reserves, in that way it would be an impediment to trade which the Financial Secretary cannot have contemplated. I emphasise what my hon. and gallant Friend has said with regard to the Parliamentary proprieties, but I would urge that it is grossly unfair to the taxpayer. It can never have been the intention of the right hon. Gentleman, and it is not the intention of this House, and we ought by some limitation to provide for the time-table of 1913 being applied to the Customs Duties which are to come under its operation.

Mr. McNEILL: The hon. and gallant Gentleman and the right hon. Gentleman who followed him have undoubtedly put forward a very important proposition for the consideration of the House. They have taken a constitutional point of very considerable importance. I am not sure that I quite followed what was in their minds on one of the points to which I will refer later, but I could have wished the two speeches had been made in the presence of the Chancellor of the Exchequer. It would have relieved me from a certain amount of responsibility, which I recognise is a heavy one, considering the period of the Bill we have now reached. We have reached a stage when it is very difficult, if not impossible, to make any promise of reservation. There are certain considerations which I should like to urge against what has been said by the right hon. Member and the hon. and gallant Member. It appears to me that both have proceeded on a fundamental misconception of what this Clause is and does. When the right hon. Gentleman spoke of the unlimited liability of the taxpayer and the hon. and gallant Member said there was no limitation either in time or otherwise as to the liability of the taxpayer, they appear to have left out of account the whole purpose of the first two Sub-sections.
Surely it is quite clear that the procedure we are dealing with is concerned with the annual financial business of the country that it begins, and is entirely concerned with Customs Duties or Excise Duties in respect of any goods. The right hon. Gentleman, who said so much about our Parliamentary traditions, does not require to be told that Excise Duties and Customs Duties are matters which are imposed in the annual Finance Bill.
There was a time when the one Finance Bill of the year was not quite what it is now. There were various different Bills scattered throughout the Parliamentary Session, but it is a well-established Parliamentary practice now that duties, whether of Excise or Customs, are dealt with, and only dealt with, in the Finance Bill of the year. Therefore, if the Clause begins by qualifying the whole of this procedure as concerned with duties of that sort, it appears to me that ipso facto it implies that we are dealing with the Finance Bill. And it is dealing with a Resolution that is passed by the Committee of Ways and Means of this House. Surely those two things in conjunction quite clearly, having regard to our Parliamentary procedure, contemplate the acceptance of a duty of Customs or Excise in the ordinary way by what is called a Money Resolution preliminary to the Finance Bill of the year, and to be legalised by the Finance Bill of the year. In the second Sub-section the liability to taxation only begins if and when an Act comes into operation imposing the duty.
The right hon. Gentleman and the hon. and gallant Gentleman appeared to me to miss what I think is a fundamental distinction between the Bowles Act and the Resolution for which it provided and what we are proposing here. The Bowles Act was passed in order to deal with an emergency that had arisen owing to the action of Mr. Bowles, and it is a very good illustration of the way in which these things come about. The practice, which turned out to be an illegal practice, had gone on for I do not know how long—for many, many years, or perhaps generations—and it was a very convenient practice. Everybody knew what it meant and nobody was aggrieved. The Income Tax and the other taxes of the year were collected at the source in the ordinary way, everybody knowing that in the course of a few weeks the Finance Bill imposing that taxation would become law. One fine day one particular gentleman, who was very ingenious in those ways, discovered that for a few weeks, until the Finance Bill was passed, it was illegal to collect Income Tax from his dividends, and he brought an action against the Bank of England in order to rectify it. It then became necessary to interfere with what was a perfectly fair and good plan, which, as I say, had gone
on for so long, and involved no grievance of any sort, financial or constitutional. But still, it having been proved to be illegal, it was necessary to deal with it by Statute. So the Bowles Act was passed, and what did it do? Not what we are asking the House to do here at all. What the Bowles Act did was to enact that, by Resolution of this House, taxes might be imposed and gathered. The liability to taxation was imposed by Resolution, and the collection of that taxation was authorised by Resolution. In those circumstances, it is quite true that there was an actual continuing liability from the moment that that Resolution was passed.

Captain BENN: But subject to a very strict time-table.

Mr. McNEILL: Yes, and that is what I am endeavouring to point out to the hon. and gallant Gentleman, that there was very good reason for a much more strict procedure in that case than in the case which we have before us now. In that case, it was—as the hon. and gallant Gentleman, wrongly, as I suggest, said we were doing here—taxing by Resolution. We are not imposing any liabilities of taxation by Resolution, but in the case of the Bowles Act they were, and, therefore, there was very good reason for much more strict and stringent regulation in the matter of time. That is not what we are doing. All that we are doing now is to provide, as the Clause says, that if and when the Act comes into operation, and not till then, shall there be any liability for the tax, but we are enabling the Customs and Excise to take security that, if and when the Finance Bill imposes that liability, then the tax shall be forthcoming. I am quite willing to admit, with the right hon. Gentleman, that there are some drawbacks and objections to a procedure of this sort.

Mr. RUNCIMAN: I hesitate to interrupt the right hon. Gentleman, but this is very important, and I am sure he will not mind. As I understand the Clause, the liability to contribute is dated from the Resolution, but there is no payment made. All that is required by the Customs and Excise is that there should be security given that, if and when the Act is passed, the payment shall be made; that is to say, there will be no transfer
of money from the taxpayer to the Customs and Excise until the Act is passed, but up to that stage he is liable in that he has to give security, so that on such date as the Act is passed he will have to make payment, and whatever import he makes after the passing of the Resolution through the House, he will only be able to get free from bond in this country on giving security for the whole demand, and it is only the actual payment that is delayed until the Act is passed.

Mr. McNEILL: That is quite so, but the difference between that and the existing law is that there will be security. A taxpayer is sometimes made liable now for a duty, say, as from the 1st May, when the Finance Bill may not be passed until July. All that we are doing is, not to alter that, but to say that in that case we shall have some security that, when the liability arises, the taxation for which he has been liable will be forthcoming. I was saying, when the right hon. Gentleman interrupted me—I am not complaining in the least that he did—that I recognise that there is some drawback, some unavoidable drawback, in a procedure of this sort, but I cannot help thinking that the attitude of the right hon. Gentleman and of the hon. and gallant Gentleman—I do not in the least complain of it—is to some extent coloured by their well-known views upon the question of Customs duties on imports. Neither of them—I will not put it higher than this—is an enthusiastic advocate of import duties.

Captain BENN: Nor is the Chancellor of the Exchequer.

Mr. McNEILL: It only shows all the more the necessity for this present Bill, that, despite his predilections, he should have thought it necessary to bring it in. What I wanted to say was this, that after all, if the right hon. Gentleman and those who agree with him could bring themselves to make this acknowledgment, that, although they do not approve of them, the present Parliament, and, as we think, the country, want these duties imposed—at all events, Parliament has imposed them—surely the right hon. Gentleman will acknowledge that, if you do have import duties, the Exchequer should get those duties in as full a measure as possible. He does not want to have a leakage. I can understand his
not wanting to have duties, but I should have thought he would have admitted that, granting the duties, the Exchequer ought to get them. The reason why this Clause appears in the Finance Bill is quite well known to the House. It is that last year there was a very large amount of forestalling, and that system of forestalling is always liable to occur at any time when there is an indication that a duty is going to be put on at a certain date.
Surely the right hon. Gentleman the Member for West Swansea (Mr. Runciman) will admit that if we are to have these duties we ought, if possible, to have some machinery for preventing that forestalling, and that is all that this Clause proposes. So far as I am aware, the Clause does not inflict any injury or loss upon the taxpayer. The honest taxpayer pays practically nothing. The Clause only means that he gives security that when the duty comes into operation he will pay that for which he is liable. The machinery is simple, and it is the ordinary machinery with which traders in this country are perfectly familiar as regards both the collection of Customs Duty on the one hand and Excise Duty on the other hand. Unless the right hon. Gentleman thinks, in his dislike to the Customs Duties, that when a duty is put on the more evasion the better and the more forestalling the better—the more motor cars that may be rushed in in the last few weeks, the more silk or any other article the better—then I really do not think that the objections he has made are really as forcible as the House might be led to believe from his very interesting speech and the constitutional colour which it gave to the Debate.

Mr. ALEXANDER: I do not propose to go into the constitutional aspect of this question, but I propose to confine myself to the reply of the Financial Secretary to the Treasury which has clearly revealed, especially at the end, the real object of the Government and which explains why the President of the Board of Trade has come into the House while this Resolution is being discussed. It was suggested by my hon. and gallant Friend the Member for Leith (Captain Benn) that probably one of the reasons for putting this Clause in the Bill was Connected with the result of certain in-
quiries that are being conducted by one of the hole-and-corner committees such as is considering the hosiery trade at present. It is necessary to bring the House back to the consideration of the fact that when the present Government was beginning to break its election pledges and to introduce Protection by the back door they were doing so on the old procedure of dealing year by year in the ordinary Finance Bill with duties to be imposed. Now in the White Paper they have laid down fresh procedure and they have told the House that after a Ways and Means Resolution they would always at the earliest possible moment embody the principle of the Resolution in a Bill. They are now, however, taking definite steps in the Finance Bill to modify that part of the procedure laid down in the White Paper. They propose under this Clause that it shall be possible for the President of the Board of Trade, if he so chooses, before the House rises for the coming Recess to lay a Ways and Means Resolution before the House proposing a Customs duty on the hosiery trade, and as there is no time limit laid down in the Clause it will be possible for that duty to be hanging over the heads of the people concerned in the trade from 31st July or 7th August, whichever may be the date at which the House rises, right until the Finance Bill of 1927. It was the distinct understanding, when the House accepted the policy of the Government in dealing with safeguarding procedure laid down in their White Paper, that at the earliest possible moment after the passing of the Ways and Means Resolution there should be a Bill laid before the House, if necessary, to deal with the procedure proposed to be carried out as the result of the finding of the Committee that had been set up.
10.0 P.M.
It is perfectly clear, especially in view of the later stages of the speech of the Financial Secretary to the Treasury that it would be possible to postpone for many months the adequate discussion of new duties which it might be proposed to impose at the behest of the Committee under the Safeguarding procedure. That is the real object behind this Clause. I do not propose to go into the argument
used by the hon. and gallant Member for Leith as to what might happen if a Labour Government came into office and this Clause remained on the Statute Book. He suggested that in that case it might be possible to use exactly the same procedure in requiring a security or bond to be made by any person in possession pf an amount of £5,000 in respect of a capital levy. If there was, as there is likely to be towards the end of the present Parliament, any prospect that the Labour Government would follow this one at the next Election, I should imagine that hon. Gentlemen opposite would take very great care to alter this Clause before that eventuality became a fact. But those of us on these benches who may desire in the future to deal with the indebtedness of the country in a sane and sound way would not, at any rate, descend to a backdoor method of this kind in order to place whatever taxation we thought might be fair on the taxpayers of this country without properly consulting them. If hon. Members on these benches were going to propose the kind of tax mentioned they would not desire to Burke discussion in this House. They would desire to have a discussion upon a Finance Bill at the earlist possible moment after any Ways and Means Resolution had been introduced.

Mr. McNEILL: I do not want to check the exuberance of the hon. Gentleman's eloquence, but it might be well to point out that he is wrong in stating that this particular Clause could be used in a case of a capital levy, because it is entirely confined to a Customs or Excise Duty.

Captain BENN: What I said was that this procedure could be used.

Mr. ALEXANDER: It could be used as a very valuable precedent. But we should not want to descend to such a procedure as is suggested simply in order to support and advance a nefarious Protectionist transaction proposed at the request of some of the hon. Member's supporters. My hon. and gallant Friend the Member for Leith, in his very excellent speech, stated that no actual money may have to be paid directly after the passing of the Ways and Means Resolution until the Act of Parliament afterwards had passed. As a matter of fact, you might have, between August, 1926, and May, June or July
1927, a number of duties imposed, many of which would affect importers in regard to several of their commodities, and they would have to give a security or bond, not in respect of the tax on one commodity, but on a number of commodities. I can quite imagine that might be necessary. It is perfectly obvious that they would require, in their annual accounts, to put a very large sum to reserve to cover contingent liabilities.
Anyone knows that if they have to put large sums to reserve in that way to cover contingent liabilities, they want to be on the right side, and the first thing they do is to increase prices to the consumer. It is therefore something that comes to be a general charge on the consumer in the country. That is not just a creation of the imagination of one who is quite frankly a Free Trader, but the actual case put to me by the traders who have been affected by the duty proposals of the Government. They will have to make proper provision for reserve, and they will have to cover themselves in the prices. I do not desire to detain the House on this matter, but I am sure they will recognise the importance of the matter being discussed. I doubt if even on the other side, hon. Members will desire that this Clause should be passed in a hurry. The Financial Secretary admitted the strong case put up by the hon. and gallant Member for Leith. On a matter of this kind, it is very much to the concern of all the House that this Clause should not be passed until the Chancellor of the Exchequer has actually been consulted in the matter and is able to give to the House his reasons, either for adhering to the Clause in the Bill or for making such modifications as have been suggested either by myself or by my hon. and gallant Friend the Member for Leith in the Amendments lower down on the Paper.

Mr. PETHICK-LAWRENCE: In support of what the hon. Member who has just sat down has said, and the request to the Financial Secretary to postpone this Clause until he has an opportunity of consulting the Chancellor of the Exchequer, may I just add this further consideration? The object of taking different stages of the Finance Bill in this House is that all the alterations of taxes might be well considered. It is
well known that the Chancellor of the Exchequer frequently finds it desirable to alter the proposals in the Resolutions which follow the Budget. The Silk Duties last year were very considerably modified in their passage through this House. When the Chancellor of the Exchequer is dealing with direct taxes, it is not unreasonable to suppose that no alteration, or only small alterations, will be made; but in the case of Customs duties the alterations may be considerable. I want to ask him to consider this. A Customs duty is proposed in the Budget. After this Clause in the Finance Bill becomes law, and the practice is adopted of imposing those Customs duties from the moment of the passage of the Resolution through the Committee of Ways and Means, importers will at once recognise that they must put up prices. The importer will at once be obliged to put up prices to the consumer. All the months we are debating it the consumer will therefore have to be compelled to pay those increased prices. I think that that negatives to a certain extent the right of this House. All our deliberations are post factum deliberations. That will be a most undesirable procedure, and I hope the Financial Secretary will see his way to consult the Chancellor of the Exchequer before this passes what is practionlly the final stage.

Mr. HARRIS: I do not want the House to be furtive on the real issue before it as between Free Trade and Protection, but it is necessary that. Parliament should have proper safeguards as to Constitutional practice so that the trader may know exactly what his position is. I believe the Financial Secretary would be willing to meet us if he had a little more time to consider this Clause. I agree that the big trader with big financial resources can get the proper securities, but, after all, our business is largely carried on by small traders who are the very essence of our business with foreign countries. The Financial Secretary knows how difficult it is for them to find big credits in order to set aside Customs requirements. In practice it does mean uncertainty, that business men will not know where they are and that many of the small importers will be embarrassed by having to obtain very large assistance from the banks. If
the Minister does not accept this very carefully worded Amendment, he ought to be prepared to put forward some practical substitute. It may be many months before traders know whether this duty is to become permanent. The position is not only unsatisfactory for the moment, but it is going to form a bad precedent and may be used against the interests of our trade, and I do press on the Minister, in the interests of his own reputation, to put forward some Amendment. I am very glad to see the Chancellor of the Exchequer has just come in and I will ask him to consider whether he cannot put forward some Amendment that will meet this point if he cannot accept the Amendment that has been moved.

Captain GARRO-JONES: The House is faced with one of the evil consequences of the continuous refusal of the Government to accept any Amendment at all. This Amendment has obviously commended itself to every intelligent Member of the House, but on account of the habit which the Government have formed, there seems to be nothing in their frame of mind which will lead them to accept or even to consider any Amendment. I cannot hope that anything I say will influence the right hon. Gentleman, but it may give him a little time to consider the point and to realise the mistake he is making by not accepting the Amendment. This Clause would be perfectly satisfactory if there were no possibility of a Resolution passed in Committee of Ways and Means, falling by the wayside, as it were, before it had statutory effect. There are, many ways in which a Resolution may fail to mature and if for any cause such a Resolution does fail to mature—because the House amends it, because the Second Reading is not carried or because the House is prorogued or dissolved—traders in this country would be faced with a perfectly impossible position. I give one example. Take the likely case of motor cars which are imported and which are liable to the McKenna Duties. Suppose, before the McKenna Duties were imposed, one of these Resolutions were passed by the House under this Clause—that is to say, that on every car which an importer imported, he was compelled to give full security for the amount of the duty—if an importer imported one car at a cost of £300, the approximate duty would be
£100, There are some firms importing 50 motor cars in a month, and such a firm would be compelled to find security for £5,000 in one month, even although they might never be called upon to pay the duty. If there was a dissolution or a prorogation, and if this went on for six months or even conceivably for a year—so far as this Clause is concerned the Act may not be passed for five years—they would be compelled, during the whole of that period, to find security. It would amount to £60,000 in 12 months for a man who imported 50 cars a month. If the Government are not afraid to accept

Amendments, but think that it would detract from their own prestige to do so, I think it is a very discreditable attitude to take up. Traders cannot be expected to go on providing an unlimited guarantee without eating into their credit. This is a genuine difficulty, and I hope the Chancellor of the Exchequer will do something to meet the reasoned Amendment which is now put forward.

Question put: "That the words proposed to be left out, to the end of page 5, line 19, stand part of the Bill."

The House divided: Ayes, 250; Noes, 136.

Division No. 329.
AYES.
[10.20 p.m.


Acland-Troyte, Lieut.-Colonel
Crooke, J. Smedley (Deritend)
Hope, Capt. A. O. J. (Warw'k, Nun.)


Agg-Gardner, Rt. Hon. Sir James T.
Crookshank, Col. C. de W. (Berwick)
Hope, Sir Harry (Forfar)


Alexander, E. E. (Leyton)
Crookshank, Cpt. H.(Lindsey, Gainsbro)
Hopkins, J. W. W.


Allen, J. Sandeman (L'pool, W. Derby)
Cunliffe Sir Herbert
Hopkinson, Sir A. (Eng. Universities)


Apsley, Lord
Curtis-Bennett Sir Henry
Hopkinson, A. (Lancaster, Mossley)


Ashley, Lt.-Col. Rt. Hon. Wilfrid W.
Curzon, Captain Viscount
Horlick, Lieut.-Colonel J. N.


Astbury, Lieut.-Commander F. W.
Daikelth, Earl of
Howard, Captain Hon. Donald


Balfour, George (Hampstead)
Dalziel, Sir Davison
Hudson, Capt. A. U. M. (Hackney, N.)


Barclay-Harvey, C. M.
Davidson, Major-General Sir John H.
Hudson, R. S. (Cumberl'nd, Whiteh'n)


Barnston, Major Sir Harry
Davies, Dr. Vernon
Hume, Sir G. H.


Beamish, Captain T. P. H.
Davies, Sir Thomas (Cirencester)
Hunter-Weston, Lt.-Gen Sir Aylmer


Beckett, Sir Gervase (Leeds, N.)
Davison, Sir W, H. (Kensington, S.)
Huntingfield, Lord


Beflairs, Commander Carlyon W.
Dawson, Sir Philip
Hurd, Percy A.


Bennett, A. J.
Dixey, A. C.
Hurst, Gerald B.


Berry, Sir George
Eden, Captain Anthony
Hutchison, G. A. Clark(Midl'n & P'bl's)


Bethel, A.
Edmondson. Major A. J.
Jackson Sir H. (Wandsworth, Cen'l)


Betterton, Henry B.
Elliot, Major Walter E.
Jacob, A E.


Birchall, Major J. Dearman
Ellis, R. G.
Jephcott, A. R.


Bird, Sir R. B. (Wolverhampton, W.)
Elveden, Viscount
Jones, G. W. H. (Stoke Newington)


Blades, Sir George Rowland
England, Colonel A.
Kennedy A. R. (Preston)


Blundell, F. N.
Everard, W. Lindsay
Kidd, J. (Linlithgow)


Boothby, R. J. G.
Falle, Sir Bertram G.
Kindersley, Major Guy M.


Bourne, Captain Robert Croft
Fanshawe, Commander G. D.
King, Captain Henry Douglas


Bowyer, Captain G. E. W.
Fermoy, Lord
Knox Sir Alfred


Braithwaite, A. N.
Fielden, E. B.
Lister, Cunliffe-, Rt. Hon. Sir Philip


Briggs, J Harold
Forestier-Walker Sir L.
Little, Dr. E. Graham


Briscoe, Richard George
Forrest, W.
Locker-Lampson, G. (Wood Green)


Brocklebank, C. E. R.
Foster, Sir Harry S.
Locker-Lampson, Com. O. (Handsw th)


Brown, Col. D. C. (N'th'l'd., Hexham)
Foxcroft, Captain C. T.
Lougher, L.


Brown, Brig.-Gen. H. C.(Berks.Newb'y)
Fraser, Captain lan
Lucas-Tooth, Sir Hugh Vere


Burgoyne, Lieut.-Colonel Sir Alan
Frece, Sir Walter de
Luce, Maj.-Gen. Sir Richard Harman


Burman, J. B.
Fremantle, Lieut.-Colonel Francis E.
MacAndrew, Major Charles Glen


Burney, Lieut.-Com. Charles D.
Gadle, Lieut.-Colonel Anthony
Macdonald, Capt. P. D. (I. of W.)


Burton, Colonel H. W.
Galbraith, J. F. W.
Macdonald, R. (Glasgow, Cathcart)


Butler, Sir Geoffrey
Gates, Percy
McDonoell, Colonel Hon. Angus


Butt, Sir Alfred
Gault, Lieut.-Col. Andrew Hamilton
McLean, Major A.


Cadogan, Major Hon. Edward
Gibbs, Col. Rt. Hon, George Abraham
Macmillan, Captain H.


Caine, Gordon Hall
Gilmour, Lt.-Col. Rt. Hon. Sir John
Macnaghten, Hon. Sir Malcolm


Campbell, E. T.
Glyn, Major R. G. C.
McNeill, Rt. Hon. Ronald John


Cassels, J. D.
Goff, Sir Park
Malone, Major P. B.


Cautley, Sir Henry S.
Gower, Sir Robert
Marriott, Sir J. A. R.


Cavzer, Sir C. (Chester, City)
Grace, John
Meller, R. J.


Cecil, Rt. Hon. Sir Evelyn (Aston)
Grattan-Doyle, Sir N.
Merriman, F. B.


Chadwick, Sir Robert Burton
Grenfe11, Edward C. (City of London)
Meyer, Sir Frank


Charteris, Brigadier-General J.
Grotrian, H. Brent
Milne, J. S. Wardlaw-


Churchill, Rt. Hon. Winston Spencer
Gunston, Captain D. W.
Mitchell, S. (Lanark, Lanark)


Churchman, Sir Arthur C.
Hall Capt. W. D'A. (Brecon & Rad.)
Mitchell, W. Foot (Saffron Walden)


Clarry, Reginald George
Hammersley, S. S.
Monsell, Eyres, Com. Rt. Hon. B. M.


Clayton, G. C.
Hannon, Patrick Joseph Henry
Moore-Brabazon, Lieut.-Col. J. T. C.


Cochrane, Commander Hon. A. D.
Harland, A.
Moreing, Captain A. H.


Colfox, Major Wm. Phillips
Harmsworth, Hon. E. C. (Kent)
Morrison-Bell, Sir Arthur Clive


Conway, Sir W. Martin
Harrison, G. J. C.
Murchison, C. K.


Cooper, A. Duff
Harvey, Major S. E. (Devon, Totnes)
Nall, Lieut.-Colonel Sir Joseph


Cope, Major William
Haslam, Henry C.
Nelson, Sir Frank


Couper, J. B.
Henderson, Lieut.-Col. V. L. (Bootle)
Neville, R. J.


Courtauld, Major J. S.
Hennessy, Major J. R. G.
Newman, Sir R. H. S. D. L. (Exeter)


Cowan, Sir Wm. Henry (Islington, N.)
Herbert, S. (York, N.R.,Scar. & Wh'by)
Nicholson, O. (Westminster)


Craig, Ernest (Chester, Crewe)
Hills, Major John Walter
O'Connor, T. J. (Bedford, Luton)


Oman, Sir Charles William C.
Shaw, Capt. W. W. (Wilts, Westb'y)
Wallace, Captain D. E.


Pennefather, Sir John
Sheffield Sir Berkeley
Warrender, Sir Victor


Percy, Lord Eustace (Hastings)
Shepperson, E W.
Waterhouse, Captain Charles


Perkins, Colonel E. K.
Simms, Dr. John M. (Co. Down)
Watson, Sir F. (Pudsey and otley)


Perring, Sir William George
Slaney, Major P. Kenyon
Watson, Rt. Hon. W. (Carlisle)


Pletou, D. P.
Somerville, A. A. (Windsor)
Watts, Dr. T.


Pliditch, Sir Philip
Spender-Clay, Colonel H.
Wells, S. R.


Pownall, Lieut.-Colonel Sir Assheton
Sprot, Sir Alexander
Wheler, Major Sir Granville C. H.


Preston, William
Stanley, Lord (Fylde)
Williams, A. M. (Cornwall, Northern)


Radford, E. A.
Stanley, Hon. O. F. G. (Westm'eland)
Williams, Com. C. (Devon, Torquay)


Raine, W.
Steel, Major Samuel Strang
Williams, Herbert G. (Reading)


Ramsden, E.
Storry-Deans, R.
Wilson, M. J. (York, N. R., Richm'd)


Rawson, Sir Cooper
Stott, Lieut.-Colonel W. H.
Wilson, R. R. (Stafford, Lichfield)


Rees, Sir Beddoe
Streatfelld, Captain S. R.
Windsor-Clive, Lieut.-Colonel George


Reld, D. D. (County Down)
Strickland, Sir Gerald
Winterton, Rt. Hon. Earl


Remer, J. R.
Stuart, Crichton-, Lord C.
Wise, Sir Fredric


Rice, Sir Frederick
Stuart, Hon. J. (Moray and Nairn)
Womersley, W. J


Robinson, Sir T. (Lanes., Stretford)
Styles, Captain H. Walter
Wood, E. (Chest'r, Stalyb'dge & Hyde)


Ropner, Major L.
Sugden, Sir Wilfrid
Wood, Sir H. K. (Woolwich, West)


Russell, Alexander West (Tynemouth)
Templeton, W. P.
Wragg, Herbert


Rye, F. G.
Thom, Lt.-Col J. G. (Dumbarton)
Yerburgh, Major Robert D. T.


Samuel, A. M. (Surrey, Farnham)
Thompson, Luke (Sunderland)
Young, Rt. Hon. Hilton (Norwich)


Sandeman, A. Stewart
Tinne, J. A.



Sanderson, Sir Frank
Titchfield. Major the Marquess of
TELLERS FOR THE AYES.—


Sassoon, Sir Philip Albert Gustave D.
Tryon, Rt. Hon. George Clement
Mr. F. C. Thomson and Captain


Shaw, R. G. (Yorks, W.R., Sowerby)
Vaughan-Morgan, Col. K. P.
Margesson.


Shaw, Lt.-Col. A. D. Mcl. (Renfrew, W)
Waddington, R.



NOES.


Adamson, Rt. Hon. W. (Fife, West)
Hall, F. (York, W. R., Normanton)
Salter, Dr. Alfred


Alexander, A. V. (Sheffield, Hillsbro')
Hall, G. H. (Merthyr Tydv11)
Scrymgeour, E.


Ammon, Charles George
Hardie, George D.
Scurr, John


Attlee, Clement Richard
Hartshorn, Rt. Hon. Vernon
Sexton, James


Barker, G. (Monmouth, Abertillery)
Hayday, Arthur
Shaw, Rt. Hon. Thomas (Preston)


Barnes, A.
Hayes, John Henry
Shepherd, Arthur Lewis


Barr, J.
Henderson, Rt. Hon. A. (Burnley)
Shiels, Dr. Drummond


Batey, Joseph
Henderson, T. (Glasgow)
Short, Alfred (Wednosbury)


Benn, Captain Wedgwood (Leith)
Hirst, G. H.
Sinclair, Major Sir A. (Caithness)


Bowerman, Rt. Hon. Charles W.
Hirst, W. (Bradford, South)
Sitch, Charles H.


Broad, F. A.
Hudson, J. H. (Huddersfield)
Slesser, Sir Henry H.


Bromfield, William
Jenkins, W. (Glamorgan, Neath)
Smillie, Robert


Bromley, J.
John, William (Rhondda, West)
Smith, Ben (Bermondsey, Rotherhithe)


Brown, James (Ayr and Bute)
Johnston, Thomas (Dundee)
Smith, H. B. Lees (Keighley)


Buchanan, G.
Jones, Henry Haydn (Merioneth)
Smith, Rennie (Penistone)


Buxton, Rt. Hon. Noel
Jones, Morgan (Caerphilly)
Snell, Harry


Charleton, H. C.
Jones, T. I. Mardy (Pontypridd)
Snowden, Rt. Hon. Philip


Clowes, S.
Kelly, W. T.
Spencer, G. A. (Broxtowe)


Cluse, W. S.
Kennedy, T.
Spoor, Rt. Hon. Benjamin Charles


Clynes, Rt. Hon. John R.
Kirkwood, D.
Stamford, T. W.


Compton, Joseph
Lansbury, George
Stephen, Campbell


Cove, W. G.
Lawrence, Susan
Sullivan, J.


Cowan, D. M. (Scottish Universities)
Lawson, John James
Sutton, J. E.


Crawford, H. E.
Lee, F.
Thorne, G. R. (Wolverhampton, E.)


Dalton, Hugh
Lindley, F. W.
Thurtle, E.


Davies, Evan (Ebbw Vale)
Lowth, T.
Tinker, John Joseph


Davison, J. E. (Smethwick)
Lunn, William
Townend, A. E.


Day, Colonel Harry
Maclean, Nell (Glasgow, Govan)
Trevelyan, Rt. Hon. C. P.


Dennison, R.
March, S.
Viant, S. P.


Duncan, C.
Mitchell, E. Rosslyn (Palsley)
Wallhead, Richard C.


Dunnico, H.
Montague, Frederick
Walsh, Rt. Hon. Stephen


Edwards, C (Monmouth, BedwelltY)
Morris, R. H.
Watson, W. M. (Dunfermlins)


Edwards, J. Hugh (Accrington)
Murnin, H.
Watts-Morgan, Lt.-Col. D. (Rhondda)


Evans, Capt. Ernest (Welsh Uiniver.)
Naylor, T. E.
Webb, Rt. Hon. Sidney


Garro-Jones, Captain G. M.
Oliver, George Harold
Welsh, J. C.


Gardner, J. P.
Palin, John Henry
Wheatley, Rt. Hon. J.


Gibbins, Joseph
Paling, W.
Wiggins, William Martin


Gillett, George M.
Parkinson, John Allen (Wigan)
Williams, C. P. (Denbigh, Wrexham)


Gosling, Harry
Pethick-Lawrence, F. W.
Williams, David (Swansea, East)


Graham, D. M. (Lanark, Hamilton)
Ponsonby, Arthur
Williams, Dr. J. H. (Lianelly)


Greenall, T.
Potts, John S.
Williams, T. (York, Don Valley)


Greenwood, A. (Nelson and Colne)
Purcell, A. A.
Wilson, R. J. (Jarrow)


Grenfell, D. R. (Glamorgan)
Richardson, R. (Houghton-le-Spring)



Griffiths, T. (Monmouth, Pontypool)
Riley, Ben
TELLERS FOR THE NOES.—


Groves, T.
Rose, Frank H.
Sir Godfrey Collins and Mr. Percy


Grundy, T. W.
Runciman, Rt. Hon. Walter
Harris.


Guest, Haden (Southwark, N.)
Saklatvala, Shapurji

Mr. A. V. ALEXANDER: I beg to move, in page 5, line 30, to leave out Sub-section (2).
I do so, not in order to go into the matter in detail, but to have a question before the House. I understand that as
a result of the previous discussion the Chancellor of the Exchequer is likely to make a suggestion for an Amendment which might possibly meet us, and we should be glad to hear if that is so.

Mr. CHURCHILL: I am very anxious in dealing with this difficulty that we should not go beyond what is necessary to meet the practical needs of the situation. We certainly do not wish to set up any procedure which, for instance, would enable a Government to pass a tax by a mere Resolution, and then, without troubling about all the other stages of Parliamentary procedure which have been designed for the protection of the taxpayer, to proceed with the imposition of a tax for an indefinite period. I think what I am going to suggest will meet the views of the right hon. Gentleman the Member for West Swansea (Mr. Runciman) and other hon. Gentlemen below the Gangway, as well as some of those who have spoken for the official Opposition. It ought to be quite possible to make it perfectly clear that no such result would accrue. I think a shorter method can be devised than that which figures in the time table Amendment, which has evidently been the result of a considerable amount of serious attention. I should be quite prepared, if it meets the views of the Opposition and if it is felt that it safeguards our financial legislation from the dangers which I have mentioned, to insert in Sub-section (2) of Clause 6, in line 24, after the word "Act," the words "giving effect to the Resolution," and after the word "operation" in the same line, to delete the words, "imposing the duty." The Subsection will then read:
If the duty so imposed is a Customs Duty, the Commissioners may require any person who, on or after the specified date, imports any goods to which the resolution applies to give security that he will, if and when an Act giving effect to the resolution comes into operation, pay the duty chargeable in respect of the goods under that Act.
That would mean that the provision to impose these duties and the obligation of giving the security would be effectually linked and only linked with the Resolution. That would make it quite impossible that any such contingency should arise as has been suggested—that, for instance, a Resolution should be passed
and the duty continued to be levied indefinitely without the full financial protection coming into operation. If this will have the effect of disarming some of the criticisms which have been made from the benches opposite, it certainly will also be in complete harmony with the purpose and intention of the Government.

Captain BENN: I am very much obliged to the Chancellor of the Exchequer for considering the point, which was really a point of substance. In the original case, the Noble Lord the Member for Oxford University (Lord H. Cecil) proposed a very rigid time limit of, I think, four months. The words proposed by the Chancellor of the Exchequer would mean, at the worst, that a Resolution would be passed at the beginning of the Session, and the Act would have to be passed before the end of that Session, because the Prorogation of Parliament would destroy the validity of the Resolution. I would say, on behalf of my right hon. Friend the Member for West Swansea (Mr. Runciman). and on our behalf here, that we are grateful to the Chancellor of the Exchequer for his proposal. It does meet our point to some extent, and, if he will embody it in the Clause, we shall not press our other Amendment.

Mr. ALEXANDER: In asking leave to withdraw my Amendment, I should like to say that we on these benches, too, are grateful to the Chancellor of the Exchequer for the consideration which he has given to this matter.

Amendment, by leave, withdrawn.

Amendments made: In page 5, line 24, after the word "Act," insert the words "giving effect to the Resolution."

Leave out the words "imposing the duty."—[Mr. Churchill.]

Mr. CHURCHILL: I beg to move, in page 5, line 30, after the word "Act," to insert the words "giving effect to the Resolution."
There are two further consequential Amendments which are necessary in order to make the Bill read correctly. They merely repeat in the region of Excise what we have already settled in the sphere of Customs.

Amendment agreed to.

Further Amendment made: In page 5, line 31, leave out the words "imposing the duty."—[Mr. Churchill.]

Orders of the Day — CLAUSE 7.—(Stabilisation of rates of Imperial Preference.)

Mr. DALTON: I beg to move, to leave out the Clause.
This subject has been debated at considerable length on previous occasions, and I do not now propose to enter at any length upon the general arguments regarding Imperial Preference which have been developed in previous Debates in this House, but on this particular proposal to stabilise existing rates for 10 years I have certain comments to make in opposition to the proposal contained in the Clause. In the first place, we on these benches take the view that the principle of seeking to bind future Parliaments for so long a period as 10 years is thoroughly objectionable. We think that each Parliament should decide for itself, that the House of Commons each year should decide for itself what taxes should be imposed, increased or reduced, and that the principle now proposed is a pernicious principle to which hon. Members opposite would take strong exception if it were to be applied by a Labour Chancellor of the Exchequer to, for example, the Super-tax, the Death Duties, or any other form of direct taxation of wealthy persons.

Lieut. - Commander BURNEY: The Road Fund?

Mr. DALTON: I am dealing with one thing at a time, if the hon. and gallant Member will allow me. If a Labour Chancellor of the Exchequer were greatly to increase the Super-tax, and were to endeavour to bind the House of Commons for 10 years in advance to maintain the rates undiminished, I think we should hear great complaints from hon. Members opposite. In the same way I think we should be prepared to admit that each Parliament should decide for itself its Super-tax no less than duties in the sphere of Customs and Excise. This principle of seeking to bind the future is, I think, objectionable on very clear and obvious grounds. Furthermore I do not believe the purpose of this 10 years scheme will really be achieved.
The purpose of the scheme, we are told, is to give the Dominions and other parts of the Empire some sense of security that these preferential arrangements which have been entered into will be maintained for that period of time. If we read the Clause carefully we shall see that in fact provision is made for the possibility of the duties, in respect of which preference is given, being either reduced or repealed altogther. The Chancellor himself said in his Budget speech that it would be perfectly open to any Government within the next 10 years to repeal altogether the duty on tea or sugar or coffee, or any of these other commodities in respect of which preference operates. That being so, the Dominions do not really get any security at all against some future Chancellor, within the 10 years' period, sweeping away these duties altogether, whether upon Dominion produce or upon foreign produce in respect to which preference is now operating. Therefore the security pretended to be given is illusory. It will not realty create in the minds of clear-sighted people in the Empire any much greater sense of security in regard to preference than they possess at present, and it may very well develop a certain public opinion in the Dominion which will not clearly apprehend the exact meaning of the Clause and will not realise that this preference may disappear even under the operation of the Clause, and therefore considerable may be created if, a few years hence, the Chancellor should come forward and propose to sweep away altogether some of these duties. There is, in short, a very great danger of creating, instead of security, misunderstanding and which no well wisher of the Empire would desire to see created.
In the third place—a point purely arithmetical—I gather that the purpose of the Clause is to secure that in future changes in the rate of taxation the Dominions shall gain more under Imperial Preference than they would do if this Clause were not introduced. To put the thing in another way, at present the preference is given in the form of a certain percentage reduction of the rate of duty. It is proposed in future to give it by way of a certain fixed or absolute amount. In future, if the duty on imported sugar is reduced, the preference, instead of being a fixed proportion of the reduced duty,
will be a fixed amount. The difference between the duty on foreign imports and the duty on Empire imports will be kept constant. It is true that, if you are reducing the duties, this new arrangement would benefit the Dominions and other parts of the Empire, but it is equally true that, if you increase any duty in respect of which preference is granted, this Clause will operate to diminish the advantage which the Empire producers now enjoy. If, for example, we should increase the duty on wine, instead of the preference to Empire wine being, as at present, a certain percentage of the duty, it would in future be a fixed amount. Therefore if the duty on foreign wine is increased by a certain amount the duty on Empire wine under this Clause will be higher than it would be if the Clause were not passed. So far as this Clause is put forward as an advantage to trade with other parts of the Empire, it will act in exactly the opposite direction, in so far as any increase in duties is concerned in the future. The Clause seems to have been designed by people who were contemplating the desirability of a reduction instead of an increase in taxation. But I doubt whether the Chancellor of the Exchequer, in the midst of his present perplexities, is prepared to rule out the possibility of certain increases in respect of some of these Duties in regard to which Preference is now given.
Finally, the whole of this Clause, the whole machinery of stabilising the rates of Imperial Preference for 10 years, and appearing thereby to be achieving something new and remarkable, illustrates the very small way in which this Government is carrying out its election pledges to develop Empire trade. Speaking for myself and, I think, for a large number of hon. Members of all parties who are very desirous to see trade with all parts of the Empire developed, whether we are thinking of the Dominions or India or the Crown Colonies, I say that this Government which talked very big at the last election about what they were going to do to develop Empire trade, have done exceedingly little. It would not be in order on this Clause for me to go into details as to what they have done and what they have failed to do. What I do say is that, in so far as their
achievements are to be measured by seeking to stabilise for 10 years the very trifling system of Preferences—I am not now expressing any view for or against Preferences as a principle—represented by these small and relatively unimportant Preferential duties, they are really playing with a large question. Those people who voted for them in the belief that an ambitious and well-conceived scheme of Empire development would be carried out, have been so far completely disappointed, and their disappointment will not be diminished by the passage into law of this Clause in the Finance Bill.
It is not for me to indicate in detail a better alternative than that which the Government have adopted, but I may perhaps in one sentence say that in my view, and in the view of the hon. Member for South East Ham (Mr. Barnes), who is to follow me, and who recently made a notable speech in the House on this matter, one of the great opportunities for developing Empire trade is not so much along these lines but along the lines of bulk purchases and big co-operative developments. Compared with the enormous possibilities of such a scheme, which the Government hitherto have shown no disposition to explore or enter upon, these pettifogging Preferences are very trifling indeed. Whether we take the view that Preferences are in all circumstances objectionable, as some hon. Members do, or whether we take the view that they are not so much objectionable as unimportant and ineffectual in comparison with the size of the problem to be tackled, we may say that, if this is the best that the Chancellor of the Exchequer can do in carrying out his election promises to develop Empire trade, he has very little to be proud of, or to take back to the electors when next he goes to the country to justify the record of his years of office.
When these alternative schemes, which I am not at liberty to develop to-night, are put forward by hon. Friends of mine, they are instantly scouted as Socialism. The hatred of Socialism in the minds of hon. Members opposite and their hatred of anything which can be represented as Socialism seems far greater than their love of the Empire or their desire to develop Empire trade by the means within their grasp at the present time. For the reason that they simply
move within this old-fashioned, out-worn scheme of Imperial Preference, and within the existing mechanism of private enterprise and private trading, they will be unable to carry out their high-sounding professed intentions to develop trade between ourselves and our kith and kin in the Dominions overseas, or in India or the Crown Colonies. We are moving in this Clause in the region of very small and insignificant things. In so far as this Clause does anything, it does it in the wrong way. It creates an unfounded and false impression in the minds of people who do not very carefully study what is proposed. It will do very little good and a great deal more harm than good. In the minds of those engaged in trade it is likely to promote, not stability, but misunderstanding and, in events not at all improbable, ill-feeling and disillusionment.

Mr. SPEAKER: I desire to point out that the Amendment standing next on the Paper—in page 6, line 7, after the word "shall," to insert the words
if shown to the satisfaction of the Commissioners to be produced under conditions of labour and payment of wages not less favourable than those prevalent among good employers of labour in the industry concerned"—
is outside the scope of the Bill.

Captain BENN: May I draw your attention to the fact that provisos dealing not only with the duty paid, but with the conditions of work under which the articles have been produced already exist. May I draw your attention to Sub-section (3) of this Clause, which says that purely Empire products mean such Empire product as is entitled to preferential rates under Section 8 of the Finance Bill? That Section empowers by Regulation the laying down of quite a number of conditions regarding the production of these articles. I would submit that to add to these conditions further conditions that labour conditions should be fair would not go outside the scope of the Bill.

Mr. SPEAKER: I think it is rather a serious thing to include such a provision in the Finance Bill.

Captain BENN: May I ask whether the Amendment which I am proposing to move to omit Sub-section (3) would be an opportunity for raising the point,
although I would respectfully press again the fact that it is competent to lay down the proportion of this and other classes of labour to be employed. I would respectfully submit it is competent to say whether the labour should be employed under fair or unfair conditions.

Mr. SPEAKER: I do not think I can accept that.

Mr. CHURCHILL: Anyone listening to the speech of the hon. Gentleman who moved this Amendment from the Front Opposition Bench would have supposed that he was an ardent advocate of imperial development and bitterly disappointed by the failure of the Government to give full effect to the high hopes excited in his bosom by the election campaign of a year and a-half ago. He comes to the House, and to his horror, grief and mortification all that we were able to do was to stabilise the existing preference for 10 years. This is dealing with it in a very small way! We are moving in the region of small and insignificant things! He used the expression "pettifogging"! These were some of the adjectives, though I cannot profess to have kept pace with their full flow. With a view to making these things less small and less pettifogging, it is proposed that the preference, instead of being stabilised for 10 years, should be stabilised on the basis of two.

Mr. DALTON: My Amendment is to leave out the Clause.

Mr. CHURCHILL: I owe the hon. Member an apology in that respect. I see that the next Amendment is to reduce the period of 10 years to two years, and I do not know that he disagrees with that Amendment, which is in the names of three of his most closely associated political comrades. I think I am right in saying that he does not disagree with them and will vote for that Amendment in due course.

Mr. DALTON: I prefer the Amendment which I have moved.

Mr. CHURCHILL: Another division in the Labour party! The hon. Member complains that we have done little in the matter of Imperial preference. It is quite true that Imperial preference as a means of uniting the Empire is confined within very definite and restricted limits, because if you do not put a tax on raw
materials the number of subjects which can be made the basis of a preference is very restricted and limited. Perfectly plain and explicit declarations were made at the last General Election on that subject, and for a good many years it has been the ascertained and declared policy of every Government, however constituted. Consequently, this decision must be frankly faced and accepted. The sphere is limited, but is there any reason why we should not go to the full limit of the field that is laid open? A great deal of sentiment is gathered around the idea of reciprocal trade and preference, and in so far as we are not stopped by any definite undertakings which have been given it is our duty to carry that policy to its full limit. And why, if you are going to give a preference—I have not heard in the last 10 years that this was a matter of party controversy—if you are going to guide Imperial trade in a common channel, why should you not do so through the aid of preference, which does not involve fresh taxation. That is the Resolution of the Imperial Conference in 1917. It was openly promulgated and never challenged or disputed in any direction. Why should we not pursue it?
For my part I will gladly lend what aid and support I can give to its development. It has been stated that I said, "The door is banged, barred and bolted on Imperial preference." That is only one of the many instances of the awful lack of clearness which some people give to a study of the speeches of their political opponents or their political friends. What I said was that "the door is banged, barred and bolted upon the protective taxation of food;" and that constitutes exactly the situation and position adopted by His Majesty's Government at the present time. So far as this particular proposal is concerned, if it is legitimate, and I conceive that all parties are committed to the development of Imperial preference apart from the laying of taxes on articles of prime necessity, if it is legitimate to cultivate Imperial trade by measures of preference, surely it is only reasonable common sense to try to invest such measures of preference with as much stability, continuity and permanence as we can.
11.0 P. M.
We have no power to bind the Parliament of the future, and I should greatly regret to have such a power. It is the elasticity of our Constitution only which has enabled us to survive many idiotic things which are done by all Parliaments from time to time, and not the least at the present time. We cannot bind the Parliament of the future, neither is there anything in this policy which prevents any of the taxes which are the subject of Preference being completely repealed. All that we say is that, in so far as and as long as these taxes are in force, there shall be these Preferences upon them, and that for 10 years, in so far as we have the power to direct events, the will of the present Parliament is that they shall be continuous and that there shall be stability. That is not merely a matter of sentiment. Anyone who has been, for example, to the West Indies and knows the condition of the sugar industry there will be well aware that it is idle to suppose that the people in those islands and the planters will be able to assemble the necessary capital and to make the works of cultivation and the developments which are necessary if they do not know from year to year that the basis of Preference on which their sugar industry is established will not be thrust away, and if these islands do not attain their prosperity through the development of such an industry as the cultivation of sugar, it only means that they will gradually fall back on to our hands to be supported by grants-in-aid, as many of them have had to do in the past. From the mere point of view of saving the Exchequer undue burdens, it is eminently desirable, once Preference is conceded, as it is conceded by all parties, that the greatest amount of stability should be given and the largest amount of security.
I quite agree that we cannot control what others may do, but, at any rate, we bring anyone into the open who wishes to reverse the system. It cannot be done merely by allowing matters to lapse You cannot simply fail to renew the Preferences in any particular year and allow them to lapse. It will be necessary in any future Parliament when it is sought to reverse this to come forward boldly and openly, and say that, in spite of the expectations which this declaration which we are now making has excited, in spite
of the beliefs and hopes that have been founded upon it, we nevertheless, the new Parliament, decide in our undisputed sovereign, plenary right, to brush it away, to break and repudiate altogether what has been previously said. Nothing can impede the will of Parliament, but it would be a consideration which any House of Commons which had the slightest sense of responsibility or desire to keep things together and make things a little better, instead of gratifying party fads—or slogans, I believe, is the word—and regardless of the consequences to the general structure of the Empire and the land in which we live—any party that really desired to keep things together would be very chary, I think, of in a hurry repealing and reversing a declaration like this, solemnly taken by a previous Parliament. And, although their right is undisputed, their exercise of that right would probably be tempered by a good deal of reflection. Therefore, I do not agree with the hon. Gentleman that this is merely an illusory provision, that this is a matter of no substance nor value in reality to the Dominions. I think it will have the effect of making them take the fullest advantage of the Preferences accorded, and do their utmost to develop the different forms of production which are covered by those Preferences, and I believe they would be justified in doing so, because I think that any Parliament coming into being, although it might have absolutely no great sympathy with these ideas, would nevertheless have a lot of other things to do, and think twice or thrice before it began to run into a lot of unnecessary trouble and friction, and make enemies of many people who might otherwise be willing to give them fair play and reasonable consideration.
Therefore, I repudiate the suggestion that these are illusory provisions just as strongly as I resist any suggestion that we are tying the hands of future Parliaments or preventing the House of Commons from removing or repealing any conditions. I do hope that we may be allowed to move forward on this policy within the limits which I have explained without it being necessary to develop sharp differences on controversies which, though they were once so formidable that they tore this country in half, have now been reduced to limits within which they command the common
support of responsible people in every quarter of the House.

Captain BENN: Once again we are the privileged spectators of the march of events. The right hon. Gentleman, at the assembly of the Colonial Premiers in 1907, when they asked for something in the nature of a preferential system of taxation, told them to their faces that he had "banged, barred and bolted the door." Now he comes forward and himself defends this Clause on grounds which are absolutely unfounded.

Mr. CHURCHILL: I must correct the hon. and gallant Gentleman. When our memories go back over 20 years we are going back over a long time, but I would like my hon. and gallant Friend to give me the reference to those words which he says I used at the Imperial Conference.

Captain BENN: The famous phrase is not in dispute—the door was
hanged, barred and bolted upon the protective taxation of food.

Mr. CHURCHILL: It is most vehemently in dispute, so far as I am concerned. I did not use the phrase
banged, barred and bolted upon the protective taxation of food
at the Imperial Conference nor within 400 miles of the Imperial Conference.

Captain BENN: rose—

HON. MEMBERS: Withdraw!

Captain BENN: I am quite willing to withdraw if those words were not used in connection with the Imperial Conference. I was under the impression that they were.

Mr. CHURCHILL: It was at a different place, at a different time, and on a different topic.

Captain BENN: Different people at different times on different topics express different views. The vice of this Clause is that it is giving the Dominions a vested interest in Protection and in the highest charges which Protection can impose on the consumers of this country. It gives the producers in the Dominions an interest in the high cost of living of our people. It is not only giving them that interest in the ad valorem form, but it is giving them that interest in the specific form, and that is much more difficult to get rid of. This Clause will make it all
the more hard to get rid of all this ridiculous catalogue of taxes on gloves, gas mantles, bottles and all the other things which appear in these absurd Schedules.
The Chancellor of the Exchequer declared that there was something in this which would make it impossible for future Parliaments to go back on it without a positive declaration. There is nothing in this Clause which changes the law in the least, except the change from ad valorem to specific. The preference does not exist in virtue of this Clause, but in virtue of Section 8 of the Act of 1919. If this Clause were never passed to-night it would not change one jot or one tittle the position of Imperial preference. This is not a Clause in an Act of Parliament. This is a Primrose League manifesto. In so far as it means anything or nothing at all I hope it will be defeated in the Division Lobby.

Mr. HADEN GUEST: I agree with what was said by my hon. Friend the Member for Peckham (Mr. Dalton) from the Front Bench with regard to this particular Clause. The Chancellor of the Exchequer speaks of stabilising these preferences in this Clause. The foundation is extraordinarily precarious. It is extraordinarily doubtful whether Preferences to the West Indies, for example, are the best way of developing the imperial sugar trade. Anyone who has looked into the question of wages and public health conditions knows that you want more than the mere imposition of a Preference. I do not want to oppose a Preference as such in the absence of an alternative proposal. If the Chancellor of the Exchequer kept his Imperial ideas up to date he would realise that with the appointment, for instance, of the Imperial Marketing

Board you have a real foundation for Imperial trade much more solid than Imperial Preference. While the right hon. Member for Colne Valley (Mr. Snowden) has stated his intention of repealing all taxes on food as far as he can do so, no Government can repeal by resolution of the House of Commons the building up of trade by the Marketing Board, which is a much better alternative than preferences. The scientific intelligence service which it is proposed to set up for the benefit of producers in all parts of the Empire is one of various means in a kind of organisation which will remain permanent not only from Government to Government, but I might say from generation to generation. It is really an exceedingly doubtful business this question of preferences, at any rate with regard to sugar and other things. I suggest that the Chancellor of the Exchequer's enthusiasm for these preferences seems more an enthusiasm for dishing the Labour party by bringing them out to the open to say something that is not true. The Labour party is just as keen and anxious for Empire development as anyone on the other side of the House. We are not only keen and anxious but are actually working for it by means that will remain permanent instead of by these precarious methods of preferences. You may wipe away these preferences in the House of Commons, but you cannot wipe away the proposals of the Empire Marketing Board. They are therefore of much more value to the Empire than these preferences.

Question put, "That the words proposed to be left out. to the end of page 6, line 38, stand part of the Bill."

The House divided: Ayes, 227; Noes, 114.

Division No. 330.]
AYES.
[11.15 p.m


Acland-Troyte, Lieut.-Colonel
Blades, Sir George Rowland
Butt, Sir Alfred


Agg-Gardner, Rt. Hon. Sir James T. 
Blundell, F. N.
Cadogan, Major Hon. Edward


Alexander, E. E. (Layton) 
Boothby, R. J. G.
Caine, Gordon Hall


Allen, J. Sandeman (L'pool, W. Derby) 
Bowyer, Capt. G. E. W.
Campbell, E. T.


Amery, Rt. Hon. Leopold C. M. S. 
Bridgeman, Rt. Hon. William Clive
Cayzer, Sir C. (Chester, City)


Apsley, Lord
Briggs, J. Harold
Cecil, Rt. Hon. Sir Evelyn (Aston)


Ashley, Lt.-Col. Rt. Hon. Wilfrid W. 
Briscoe, Richard George
Chadwick, Sir Robert Burton


Astor, Maj. Hn. John J. (Kent, Dover) 
Brocklebank, C. E. R.
Charteris, Brigadier-General J.


Atkinson, C. 
Brown, Col. D. C. (N'th'I'd., Hexham)
Churchill, Rt. Hon. Winston Spencer


Balfour, George (Hampstead)
Brown, Brig.-Gen. H.C.(Berks,Newb'y)
Clarry, Reginald George


Beamish, Captain T. P. H. 
Burgoyne, Lieut.-Colonel Sir Alan
Clayton, G. C.


Beckett, Sir Gervase (Leeds, N.) 
Burman, J. B.
Cochrane, Commander Hon. A. D.


Ballairs, Commander Canyon W. 
Burney, Lieut.-Com. Charles D.
Cockerill, Brig.-General Sir G. K.


Bethel, A. 
Burton, Colonel H. W.
Colfox, Major Wm. Phillips


Bird, Sir R. B. (Wolverhampton, W.) 
Butler, Sir Geoffrey
Cooper. A. Duff


Cope, Major William
Hopkins, J. W. W.
Rice, Sir Frederick


Couper,.J. B.
Horlick, Lieut.-Colonel J. N.
Ropner, Major L.


Courtauld, Major J. S.
Howard, Captain Hon. Donald
Ruggles-Brise, Major E. A.


Cowan Sir Wm. Henry (Islingtn. N.)
Hudson, Capt. A. U. M. (Hackney, N.)
Russell, Alexander West (Tynemouth)


Craig, Ernest (Chester, Crewe)
Hume, Sir G. H.
Rye, F. G.


Crooke, J. Smedley (Deritend)
Hurd, Percy A.
Salmon, Major I.


Crookshank, Col, C. de W. (Berwick)
Inskip, Sir Thomas Walker H.
Samuel, A. M. (Surrey, Farnham)


Crookshank, Cpt. H.(Lindsey, Gainsbro)
Jackson, Sir H. (Wandsworth, Cen'l)
Samuel, Samuel (W'dsworth, Putney)


Cunliffe, Sir Herbert
Jacob, A. E
Sandeman, A. Stewart


Curzon, Captain Viscount
Jephcott, A. R.
Sanders, Sir Robert A.


Dalkeith, Earl of
Jones, G. W. H. (Stoke Newington)
Sanderson, Sir Frank


Davidson, Major-General Sir John H.
Kennedy, A. R. (Preston)
Sassoon, Sir Philip Albert Gustave D.


Davies, Dr. Vernon
Kidd, J. (Linlithgow)
Shaw, R. G. (Yorks, W.R., Sowerby)


Davison, Sir W. H. (Kensington, S.)
Kindersley, Major Guy M.
Shaw, Lt.-Col. A. D. Mcl. (Renfrew, W)


Dixey, A. C.
King, Captain Henry Douglas
Shaw, Capt. W. W. (Wilts, Westb'y)


Eden, Captain Anthony
Knox, Sir Alfred
Sheffield, Sir Berkeley


Edmondson, Major A. J.
Lister, Cunliffe-, Rt. Hon. Sir Philip
Shepperson, E. W.


Edwards, J. Hugh (Accrington)
Little, Dr. E. Graham
Simms, Dr. John M. (Co. Down)


Elliot, Major Walter E.
Loder, J. de V.
Slaney, Major P. Kenyon


England, Colonel A.
Lougher, L.
Somerville, A. A. (Windsor)


Everard, W. Lindsay
Lucas-Tooth, Sir Hugh Vere
Sprot, Sir Alexander


Falle, Sir Bertram G.
Luce, Maj.-Gen. Sir Richard Harman
Stanley, Hon. O. F. G.(Westm'eland)


Fanshawe, Commander G. D.
MacAndrew, Major Charles Glen
Steel, Major Samuel Strang


Fermoy, Lord
Macdonald, Capt. P. D. (I. of W.)
Stott, Lieut.-Colonel W. H.


Fielden, E. B.
Macdonald, R. (Glasgow, Cathcart)
Streatfeild, Captain S. R.


Forestier-Walker, Sir L.
McLean, Major A.
Strickland, Sir Gerald


Forrest, W.
Macmillan, Captain H.
Stuart, Crichton-, Lord C.


Foxcroft, Captain C. T.
Macnaghten, Hon. Sir Malcolm
Stuart, Hon. J. (Moray and Nairn)


Fraser, Captain Ian
McNeill, Rt. Hon. Ronald John
Styles, Captain H. Walter


Frece, Sir Walter de
Maitland, Sir Arthur D. Steel-
Sugden, Sir Wilfrid


Fremantle, Lieut.-Colonel Francis E.
Malone, Major P. B.
Thom, Lt.-Col. J. G. (Dumbarton)


Gadie, Lieut.-Col. Anthony
Margesson, Captain D.
Thomson, F. C. (Aberdeen, South)


Galbraith, J. F. W.
Marriott, Sir J. A. R.
Tinne, J. A.


Gates, Percy
Mellor, R. J.
Titchfield, Major the Marquess of


Gault, Lieut.-Col. Andrew Hamilton
Merriman, F. B.
Tryon, Rt Hon. George Clement


Gibbs, Col. Rt. Hon. George Abraham
Meyer, Sir Frank
Vaughan-Morgan, Col. K. P.


Gilmour, Lt.-Col. Rt. Hon. Sir John
Milne, J. S. Wardlaw-
Waddington, R.


Glyn, Major R. G. C.
Mitchell, S. (Lanark, Lanark)
Wallace, Captain D. E.


Goff, Sir Park
Monsell, Eyres, Com. Rt. Hon. B. M.
Warrender, Sir Victor


Gower, Sir Robert
Moore-Brabazon, Lieut.-Col. J. T. C.
Waterhouse, Captain Charles


Grace, John
Moreing, Captain A. H.
Watson, Sir F. (Pudsey and Otley)


Grattan-Doyle, Sir N.
Morrison Bell, Sir Arthur Clive
Watson, Rt. Hon. W. (Carlisle)


Grotrian, H. Brent
Nail, Lieut.-Colonel Sir Joseph
Watts, Dr. T.


Guest, Capt. Rt. Hon. F. E. (Bristol, N.)
Nelson, Sir Frank
Wells, S. R.


Guinness, Rt. Hon, Walter E.
Neville, R. J.
Wheler, Major Sir Granville C. H.


Gunston, Captain D. W.
Newman, Sir F. H. S. D. L. (Exeter)
White, Lieut.-Col. Sir G. Dalrymple


Hall, Capt. W. WA, (Brecon & Rad.)
Nicholson, O. (Westminster)
Williams, A. M. (Cornwall, Northern)


Hammersley, S. S.
Nuttall, Ellis
Williams, Com. C. (Devon, To[...]quay)


Hanbury, C.
O'Connor, T. J. (Bedford, Luton)
Williams, Herbert G. (Reading)


Hannon, Patrick Joseph Henry
O'Neill, Major RI. Hon, Hugh
Wilson, M. J. (York, N. R., Richm'd)


Harland, A.
Oman, Sir Charles William C.
Wilson, R. R. (Stafford, Lichfield)


Harmsworth, Hon. E. C. (Kent)
Pennefather, Sir John
Windsor-Clive, Lieut.-Colonel George


Harrison, G. J. C.
Percy, Lord Eustace (Hastings)
Winterton, Rt. Hon. Earl


Harvey, Major S. E. (Devon, Totnes)
Pielou, D. P.
Wise, Sir Fredric


Haslam, Henry C.
Pilditch, Sir Philip
Womersley, W. J.


Henderson, Lieut.-Col. V. L. (Bootle)
Power, Sir John Cecil
Wood, E. (Chest'r. Stalyb'dge & Hyde)


Heneage, Lieut.-Col. Arthur P.
Pownall, Lieut.-Colonel Sir Assheton
Wood, Sir Kingsley (Woolwich, W.)


Hennessy, Major J. R. G.
Preston, William
Wragg, Herbert


Herbert, S. (York, N.R., Scar. & Wh'by)
Radford, E. A.



Hills, Major John Walter
Raine, W.
TELLERS FOR THE AYES.—


Hope, Capt. A. O. J. (Warw'k, Nun.)
Rees, Sir Beddoe
Major Sir Harry Barnston and


Hope, Sir Harry (Forfar)
Remer, J. R.
Lord Stanley.


NOES


Adamson, Rt. Hon. W. (Fife, West)
Davies, Evan (Ebbw Vale)
Hall, F. (York, W. R., Normanton)


Alexander, A. V. (Sheffield, Hillsbro')
Davison, J. E. (Smethwick)
Hall, G. H. (Merthyr Tydvil)


Ammon, Charles George
Day, Colonel Harry
Hamilton, Sir R. (Orkney & Shetland)


Barnes, A.
Duncan, C.
Hardie, George D.


Barr, J.
Dunnico, H.
Harris, Percy A.


Batey, Joseph
Evans, Capt. Ernest (Welsh Univer.)
Hartshorn, Rt. Hon. Vernon


Benn, Captain Wedgwood (Leith)
Fenby, T. D.
Hayday, Arthur


Bowerman, Rt. Hon. Charles W.
Garro-Jones, Captain G. M.
Hayes, John Henry


Broad, F. A.
Gardner, J. P.
Henderson, Rt. Hon. A. (Burnley)


Bromley, J.
Gibbins, Joseph
Henderson, T. (Glasgow)


Brown, James (Ayr and Bute)
Gillett, George M.
Hirst, G. H.


Buchanan, G.
Gosling, Harry
Hirst, W. (Bradford, South)


Charleton, H. C.
Graham, D M. (Lanark, Hamilton)
Hors-Belisha, Leslie


Clowes, S.
Graham, Rt. Hon. Wm, (Edin., Cent.)
Hudson, J. H. (Huddersfield)


Cluse, W. S.
Greenall, T.
Jenkins, W. (Glamorgan, Neath)


Collins, Sir Godfrey (Greenock)
Greenwood, A. (Nelson and Colne)
John, William (Rhondda, West)


Compton, Joseph
Grenfell, D. R. (Glamorgan)
Jones, Henry Haydn (Merioneth)


Crawford, H. E.
Griffiths, T. (Monmouth, Pontypool)
Jones, T. I. Mardy (Pontypridd)


Dalton, Hugh
Grundy, T. W.
Kelly, W. T.




Kennedy, T.
Richardson, R. (Houghton-le-Spring)
Sullivan, J.


Kenworthy, Lt.-Com, Hon. Joseph M.
Riley, Ben
Sutton. J. E.


Lawrence, Susan
Rose, Frank H.
Thorne, G. R. (Wolverhampton, E.)


Lawson, John James
Runclman, Rt. Hon. Walter
Tinker, John Joseph


Lee, F.
Saklatvala, Shapurji
Townend, A. E.


Lindley, F. W.
Salter, Dr. Alfred
Vaint, S. P.


MacLaren, Andrew
Scurr, John
Walsh, Rt. Hon. Stephen


Maclean, Nell (Glasgow, Govan)
Sexton, James
Watson, W. M. (Dunfermllne)


March, S.
Shaw, Rt. Hon. Thomas (Preston)
Watts-Morgan, Lt.-Col. D. (Rhondda)


Mitchell, E. Rosslyn (Palsiey)
Shiels, Dr. Drummond
Welsh, J. C.


Morris, R. H.
Short, Alfred (Wednesbury)
Wheatley, Rt. Hon. J.


Murnin, H.
Sinclair, Major Sir A. (Caithness)
Wiggins, William Martin


Naylor, T. E.
Sitch, Charles H.
Williams, C. P. (Denbigh, Wrexham)


Oliver, George Harold
Smith, Ben (Bermondsey, Rotherh'the)
Williams, David (Swansea, East)


Palin, John Henry
Smith, H. B. Lees- (Kelghley)
Williams, Dr. J. H. (Lianelly)


Raine, W.
Snell, Harry
Williams, T. (York, Don Valley)


Pethick-Lawrence, F. W.
Snowden, Rt. Hon. Philip
Wilson, R. J. (Jarrow)


Ponsonby, Arthur
Spoor, Rt. Hon. Benjamin Charles



Potts, John S.
Stamford, T. W.
TELLERS FOR THE NOES.—


Purcell, A. A.
Stephen, Campbell
Mr. Allen Parkinson and Mr.




Charles Edwards.

Captain BENN: In order to save time I do not propose to move my Amendment to leave out Sub-section (3).

Orders of the Day — CLAUSE 10.—(Continuation and amendment of Part I. of Safeguarding of Industries Act, 1921, 11 and 12 Geo. 5, c. 47.)

Mr. PETHICK-LAWRENCE: I beg to move to leave out the Clause.
This Clause seeks to reimpose, with modifications and for a period of 10 years, Part 1 of the Safeguarding of Industries Act. I hope the Chancellor of the Exchequer will continue to favour us with his presence, because on the Committee stage he left the whole defence to the President of the Board of Trade. I see that he flees from the wrath to come. On this particular Clause there is a substantial measure of agreement between different sides of the House. In addition to the members of the Labour Party, I believe nearly all the sections of the Liberal Party, and a substantial part of the party opposite regard these duties as Protectionist. Whereas we oppose the duties on that ground, hon. Members opposite rejoice in them on that ground; but the Chancellor of the Exchequer, the Prime Minister, and a few others defend this Clause not because it is Protectionist but because in their view it is something quite different. They claim that in this way they are safeguarding the key industries of the country.
Without making a long speech I will summarise our principal case against this Clause. We say that these key industries have no reality in fact. A key industry is supposed to protect this country in time of war. If any one compares the kind of things which were
necessary to carry on the late war with the things which would have been regarded as necessary in the war against Napoleon, it will be seen that it is quite impossible to predict what will be the key industries of a future war. What we regard as key industries at the present time may be of no importance in the terrible misfortune of any other war. In the second place, we say that even if there are such things as key industries this Clause does not safeguard them, for while it establishes a measure of protection it by no means insists that the manufacturers of this country shall make what will be the actual key things in times to come. They will only make the things which it is commercially profitable for them to make.
What is the defence of these duties? We believe they are really Protectionist in design. The Prime Minister, when they were originally imposed, said they were imposed for five years, and that at the end of that time the industries would stand on their feet. We are seeing today what generally takes place in matters of Protection. When the time comes for the industries to stand on their feet, so far from their doing so another term is given to them—in this case the 5 years' period is extended to 10 years. The case is still worse when we come to that part of sub-section (2) which deals with optical glass. There the duties have failed so palpably to achieve their object that it is useless merely to reimpose them, and they are not only continued for a longer period but are increased from 33⅓ per cent. to 50 per cent.
I am not going to give detailed reasons why we oppose this large increase in duties, but the duty on optical glass covers a large range of articles much
wider than the key industries which they purport to represent. When it is realised that they deal with such things as small cameras and optical instruments it is evident that you cannot protect them by a duty of this kind. These duties are larger ad valorem on the cheap than on the dear articles on account of the proposal not only to tax the lens but the whole value of the camera in which the lens is included. You tax a pair of boots because there is a silk tag attached and you tax cameras because they contain lenses. When you come to the third Sub-section things are carried to a reductio ad absurdum simply because they are parts of an article which might contain optical glass.

The PRESIDENT of the BOARD OF TRADE (Sir Philip Cunliffe-Lister): There is only one statement made by the hon. Member who has just sat down and that is that at one time we were all

agreed about these duties and they were recommended by Balfour of Burleigh Committee. At one time the Leader of the Liberal Party recommended every one of these duties to the House although that party opposed them in the Safeguarding of Industries Bill. I claim that these duties have been successful. Under them industry has developed, research has been carried out and new processes have been started. What is more, in spite of the tax optical glass manufacture has progressed. Under these circumstances I think we should be very unwise, having regard to the experience of the past, both in peace and war, if we did not continue duties which have so successfully served their purpose.

Question put, "That the words proposed to be left out stand part of the Bill."

The House divided: Ayes. 187; Noes, 98.

Division No. 331.]
AYES.
[11.35 p.m.


Acland-Troyte, Lieut-Colonel
Eden, Captain Anthony
Kindersley, Major Guy M.


Agg-Gardner, Rt. Hon. Sir James T.
Edmondson, Major A. J.
King, Captain Henry Douglas


Allen, J. Sandeman (L'pool, W. Derby)
Eillot, Major Walter E.
Knox, Sir Alfred


Amery, Rt. Hon. Leopold C. M. S.
Falle, Sir Bertram G.
Lister, Cunliffe-, Rt. Hon. Sir Philip


Apsley, Lord
Fanshawe, Commander G. D.
Little, Dr. E. Graham


Astor, Maj. Hon. John J.(Kent, Dover)
Fermoy, Lord
Loder, J. de V.


Atkinson, C.
Fielden, E. B.
Lougher, L.


Balfour, George (Hampstead)
Forestier-Walker, Sir L.
Lucas-Tooth, Sir Hugh Vere


Beamish, Captain T. P. H.
Foxcroft, Captain C. T.
Luce, Major-Gen. Sir Richard Harman


Beckett, Sir Gervase (Leeds, N.)
Fraser, Captain lan
MacAndrew, Major Charles Glen


Bellairs, Commander Carlyon W.
Frece, Sir Walter de
Macdonald, Capt. P. D. (I. of W.)


Bethel, A.
Fremantle, Lieut.-Colonel Francis E.
MacDonald, R. (Glasgow, Cathcart)


Betterton, Henry B.
Gadle, Lieut.-Col. Anthony
McLean, Major A.


Bird, Sir R. B. (Wolverhampton, W.)
Galbraith, J. F. W.
Macmillan, Captain H.


Blades, Sir George Rowland
Gates, Percy
McNeill, Rt. Hon. Ronald John


Blundell, F. N.
Gault, Lieut.-Col. Andrew Hamilton
Maitland, Sir Arthur D. Steel-


Boothby, R. J. G.
Gibbs, Col. Rt. Hon. George Abraham
Margesson, Captain D.


Bridgeman, Rt. Hon. William Clive
Goff, Sir Park
Marriott, Sir J. A. R.


Briggs, J. Harold
Grace, John
Merriman, F. B.


Briscoe, Richard George
Grattan-Doyle, Sir N.
Meyer, Sir Frank


Brocklebank, C. E. R.
Grotrian, H. Brent
Mitchell, S. (Lanark, Lanark)


Brown, Brig.-Gen. H.C.(Berks, Newb'y)
Guinness, Rt. Hon. Walter E.
Monsell, Eyres, Cum. Rt. Hon. B. M.


Burman, J. B.
Gunston, Captain D. W.
Moore-Brabazon, Lieut.-Col. J. T. C.


Burton, Colonel H. W.
Hail, Capt. W. D'A. (Brecon & Rad.)
Morning Captain A. H.


Butler, Sir Geoffrey
Hammersley, S. S.
Morrison-Bell, Sir Arthur Clive


Butt, Sir Alfred
Hanbury, C.
Nall, Lieut.-Colonel Sir Joseph


Cadogan, Major Hon. Edward
Hannon, Patrick Joseph Henry
Newton, Sir D. G. C. (Cambridge)


Campbell, E. T.
Harland, A.
Nicholson, O. (Westminster)


Cavzer, Sir C. (Chester, City)
Harmsworth, Hon. E. C. (Kent)
Nuttall, Ellis


Cecil, Rt. Hon. Sir Evelyn (Aston)
Harrison, G. J. C.
O'Connor, T. J. (Bedford, Luton)


Chadwick, Sir Robert Burton
Hartington, Marquess of
O'Neill, Major Rt. Hon. Hugh


Charteris, Brigadier-General J.
Harvey, Major S. E. (Devon, Totnes)
Pennefather, Sir John


Churchill, Rt. Hon. Winston Spencer
Henderson, Lieut-Col. V. L. (Bootle)
Percy, Lord Eustace (Hastings)


Clayton, G. C.
Heneage, Lieut.-Colonel Arthur P.
Pielou, D. P.


Cocnrane, Commander Hon. A. D.
Hennessy, Major J. R. G.
Pliditeh, Sir Philip


Cockerill, Brig.-General Sir G. K.
Herbert, S.(York, N.R., Scar. & Wh'by)
Power, Sir John Cecil


Cooper, A. Duff
Hills, Major John Waller
Pownall, Lieut.-Colonel Sir Assheton


Cope, Mayor William
Hope, Capt. A. O. J. (Warw'k, Nun.)
Radford. E. A.


Cowper, J. B.
Hope, Sir Harry (Forfar)
Raine, W.


Courtauld, Major J. S.
Hopkins, J. W. W.
Remer, J. R.


Craig, Ernest (Chester, Crewe)
Horlick, Lieut.-Colonel J. N.
Rice, Sir Frederick


Crookshank, Cpt. H. (Lindsey, Gainsbro)
Howard, Captain Hon. Donald
Ropner, Major L.


Cunliffe, Sir Herbert
Hudson, Capt. A. U. M. (Hackney, N.)
Ruggles-Brise, Major E. A.


Curzon, Captain Viscount
Inskip, Sir Thomas Walker H.
Russell, Alexander West (Tynemouth)


Dalkeith, Earl of
Jacob, A. E.
Salmon, Major I.


Davidson, Major-General Sir John H.
Jones, G. W. H. (Stoke Newington)
Samuel, A. M. (Surrey, Farnham)


Davies, Dr. Vernon
Kennedy, A. R. (Preston)
Samuel, Samuel (W'dsworth, Putney)


Dixey, A. C.
Kidd, J. (Linlithgow)
Sandeman, A. Stewart


Sanders, Sir Robert A.
Stuart, Hon. J. (Moray and Nairn)
Williams, A. M. (Cornwall, Northern)


Sanderson, Sir Frank
Sugden, Sir Wilfred
Williams, Com. C. (Devon, Torquay)


Shaw, R. G. (Yorks, W.R., Sowerby)
Thom, Lt.-Col. J. G. (Dumbarton)
Williams, Herbert G. (Reacting)


Shaw, Lt.-Col. A. D. Mcl.(Renfrew, W.)
Thomson, F. C. (Aberdeen, South)
Wilson, M. J. (York, N. R., Richm'd)


Shaw, Capt. W. W. (Wilts, Westb'y)
Tinne, J. A.
Wilson, R. R. (Stafford, Lichfield)


Shepperson, E. W.
Titchfield, Major the Marquess of
Windsor-Clive, Lieut-Colonel George


Simms, Dr. John M. (Co. Down)
Tryon, Rt. Hon. George Clement
Winterton, Rt. Hon. Earl


Slaney, Major P. Kenyon
Vaughan-Morgan, Col. K. P.
Wise, Sir Fredric


Stanley, Lord (Fylde)
Waddington, R.
Womersley, W. J.


Stanley, Hon. O. F. G. (Westm'etand)
Wallace, Captain D. E.
Hood, E. (Chest'r, Stalyb'ge & Hyde)


Steel, Major Samuel Strang
Waterhouse, Captain Charles
Wood, Sir Kingsley (Woolwich, W.)


Storry-Deans, R.
Watson, Sir F. (Pudsey and Otley)
Wragg, Herbert


Stott, Lieut.-Colonel W. H.
Watson, Rt. Hon. W. (Carlisle)



Streatfeild, Captain S. R.
Wells, S. R.
TELLERS FOR THE AYES.—


Strickland, Sir Gerald
Whaler, Major Sir Granville C. H.
Major Sir Harry Barnston and


Stuart, Crichton-, Lord C.
White, Lieut.-Col. Sir G. Dalrymple
Captain Bowyer.


NOES.


Adamson, Rt. Hon. W. (Fife, West)
Grenfell, D. R. (Glamorgan)
Paling, W.


Alexander, A. V. (Sheffield, Hillsbro')
Grundy, T. W.
Pethick-Lawrence, F. W.


Ammon, Charles George
Hall, F. (York, W. R., Normanton)
Potts, John S.


Barnes, A.
Hall, G. H. (Merthyr Tydvil)
Purcell, A. A.


Barr, J.
Hamilton, Sir R. (Orkney & Shetland)
Richardson, R. (Houghton-le-Spring)


Batey, Joseph
Hardie, George D.
Riley, Ben


Benn. Captain Wedgwood (Leith)
Harris, Percy A.
Runciman, Rt. Hon. Walter


Bowerman, Rt. Hon. Charles W.
Hartshorn, Rt. Hon. Vernon
Salter, Dr. Alfred


Broad, F. A.
Hayday, Arthur
Sexton, James


Bromley, J.
Hayes, John Henry
Shaw, Rt. Hon. Thomas (Preston)


Brown. James (Ayr and Bute)
Henderson, Rt. Hon. A. (Burnley)
Shiels, Dr. Drummond


Buchanan, G.
Henderson, T. (Glasgow)
Short, Alfred (Wednesbury)


Charleton, H. C.
Hirst, G. H.
Sinclair, Major Sir A. (Caithness)


Clowes, S.
Hirst, W. (Bradford, South)
Sitch, Charles H.


Cluse, W. S.
Hore-Belisha, Leslie
Smith, Ben (Bermondsey, Rotherhithe)


Collins, Sir Godfrey (Greenock)
Hudson, J. H. (Huddersfield)
Snowden, Rt. Hon. Philip


Compton, Joseph
Jenkins, W. (Glamorgan, Neath)
Stamford, T. W.


Crawfurd, H. E.
John, William (Rhondda, West)
Stephen, Campbell


Dalton, Hugh
Jones, Henry Haydn (Merloneth)
Sullivan, J.


Davies, Evan (Ebbw Vale)
Jones, Morgan (Caerphilly)
Sutton, J. E.


Davison, J. E. (Smethwiek)
Jones, T. I. Mardy (Pontypridd)
Thorne, G. R. (Wolverhampton, E.)


Day, Colonel Harry
Kelly, W. T.
Tinker, John Joseph


Dunnico, H.
Kennedy, T.
Townend, A. E.


England, Colonel A.
Lawrence, Susan
Watson, W. M. (Dunfermline)


Evans, Capt. Ernest (Welsh Univer)
Lawson, John James
Watts-Morgan, Lt.-Col. D. (Rhondda)


Fenby, T. D.
Lee, F.
Welsh, J. C.


Garro-Jones, Captain G. M.
Lindley, F. W.
Wheatley, Rt. Hon J.


Gardner, J. P.
Mac Laren, Andrew
Wiggins, William Martin


Gibbins, Joseph
Maclean, Nell (Glasgow, Govan)
Williams, C. P. (Denbigh, Wrexham)


Gillett, George M.
Mitchell, E. Rosslyn (Paisley)
Williams. T. (York, Don Valley)


Gosling, Harry
Murnin, H.



Graham, D. M. (Lanark, Hamilton)
Naylor, T. E.
TELLERS FOR THE NOES.—


Greenall, T.
Oliver, George Harold
Mr. Allen Parkinson and Mr.


Greenwood, A. (Nelson and Colne)
Palin, John Henry
Charles Edwards.

Ordered, "That further Consideration of the Bill, as amended, be now adjourned."—[Sir P. Cunliffe-Lister.]

Bill, as amended, to be further considered upon Monday next.

Orders of the Day — GAS REGULATION ACT, 1920.

Motion made, and Question proposed,

That the draft of a Special Order proposed to be made by the Board of Trade under Section 10 of The Gas Regulation Act, 1920, on the application of the Liverpool Gas Company, which was presented on the 8th June and published, be approved, subject to the following modifications:

Clause 4, line 2, leave out "become and."

Clause 4, line 2, after "be," insert "deemed to have been."

Clause 4, line 4, leave out "by virtue," and insert "as from the date."

Clause 5, sub-clause (4), line 1, after "be," insert "deemed to have been."

Clause 5, sub-clause (5), line 3, leave out "be vested," and insert "have been vested."

Clause 8, sub-clause (4), line 4, leave out "shall be," and insert "were."

Clause 8, sub-clause (4), line 5, after "and," insert "are."

Clause 9, sub-clause (1), line 7, leave out "transfer," and insert "this Order."

Clause 9, sub-clause (1), line 9, leave out "the date of transfer, and insert "that date."

Clause 13, line 1, leave out "transfer," and insert "this Order."

Clause 14, line 3, leave out "transfer shall as from that date," and insert "this Order shall as from the date of transfer."

Clause 16, line 2, after "include," insert "and be deemed to have extended to and included."

Clause 36, sub-clause (2), line 3, leave out "transfer," and insert "this Order."—[Sir Burton Chadwick.]

Mr. NEIL MACLEAN: There are 13 Amendments on the Paper in regard to this Order. I cannot see why the House should agree to an Order of this kind, without an explanation from the Minister in charge. Why should an Order placed upon the Paper originally by the Board of Trade, require so many Amendments when it is put before the House for final acceptance? What is the necessity for 13 Amendments to an Order, which only consisted of four lines and one word?

The PARLIAMENTARY SECRETARY to the BOARD of TRADE (Sir Burton Chadwick): It is rather unusual to have so many Amendments to a Gas Order. The Order was presented to the House on the 8th June and the date for transfer was to be the let July. Unfortunately, for good reasons, it was not possible to obtain the approval of both Houses before that date, and it is very desirable that the date of transfer should be the date for the commencement of the second half of the financial year of the Liverpool Gas Company. Accordingly it has been necessary to submit for approval certain modifications of the Order to provide for the fact that the date of transfer has now been passed. The modifications were considered and approved by the Special Orders Committee in another place at their meeting on the 1st July, and the Amendments are for the purpose of ante-dating the Order to the 1st July. I hope that after this explanation the hon. Member will withdraw his opposition.

Mr. MACLEAN: Are we to understand that this Order is in operation and that the purpose of these 13 Amendments is to make the Order on the Paper retrospective? Is this another instance of the retrospective legislation of the Tory Government? This Order is in operation without the sanction of this House, and these Amendments are to give sanction to that which is already in operation.

Sir B. CHADWICK: The hon. Member is wrong. The Order is not in operation until it is made. We are seeking authority to make the Order. When the Order is made, it will be made
in this form, so that it may date from 1st July.

Mr. MACLEAN: In the event of these Amendments being carried, will the Order be brought forward, as amended, and placed on the Order Paper? Will it be printed, as amended, and submitted to the House for consideration?

Sir B. CHADWICK: When we obtain the approval of the House the Order will be made.

Mr. MACLEAN: As amended?

Sir B. CHADWICK: Yes.

Mr. MACLEAN: Will it be brought forward to the House in its amended form?

Sir B. CHADWICK: No.

Mr. MACLEAN: I take exception to the way this is being put through the House, and I intend to oppose every Amendment and carry it to a Division.

Sir JOSEPH NALL: If the House approves the Motion, it will simply approve the Order with these modifications. There is no need to bring them forward again.

Mr. MACLEAN: The Order will require to be reprinted, with those modifications in it?

Sir B. CHADWICK: The Order will be printed, but it will not appear in the Orders of this House.

Mr. MACLEAN: Oh!

Question put:

The House proceeded to a Division.

Mr. MACLEAN: (seated and covered): May I ask you, Mr. Speaker, in what way you propose to put the Amendment in the Order Paper? Are you putting them all together, or separately?

Mr. SPEAKER: The Question is "That the Order, as modified, be approved." There is no question of Amendment.

Mr. MACLEAN: Every one of these is an Amendment to the Order and consequently you cannot modify the Order by
taking them all at once, otherwise a precedent will be established.

Mr. SPEAKER: The House may approve an Order with or without modifications.

Resolved,
That the draft of a Special Order proposed to be made by the Board of Trade

In this case it is with modifications.

The House divided: Ayes, 169; Noes, 15.

Division No. 332.]
AYES.
[11.51 p.m.


Acland-Troyte, Lieut.-Colonel
Gardner, J. P.
Oliver, George Harold


Adamson, Rt. Hon. W. (Fife, West)
Gates, Percy
Parkinson, John Alien (Wigan)


Agg-Gardner, Rt. Hon. Sir James T.
Gibbins, Joseph
Pennefather, Sir John


Allen, J. Sandeman (L'pool, W. Derby)
Gibbs, Col. Rt. Hon. George Abraham
Pielou, D. P.


Apsley, Lord
Goff, Sir Park
Potts, John S.


Atkinson, C.
Grace, John
Ramer, J. R.


Balfour, George (Hampstead)
Gunston, Captain D. W.
Rice, Sir Frederick


Barnes, A.
Hail, Capt. W. D'A. (Brecon & Rad.)
Richardson, R. (Houghton-le-Spring)


Barr, J.
Hammersley, S. S.
Robinson, Sir T. (Lancs., Stretford)


Beamish, Captain T. P. H.
Hannon, Patrick Joseph Henry
Ropner, Major L.


Beckett, Sir Gervase (Leeds, N.)
Harland, A.
Ruggles-Brise, Major E. A.


Bethel, A.
Hartington, Marquess of
Russell, Alexander West (Tynemouth)


Betterton, Henry B.
Hartshorn, Rt. Hon. Vernon
Salmon, Major I.


Bird, Sir R. B. (Wolverhampton, W.)
Harvey, Major S. E. (Devon, Totnes)
Samuel, Samuel (W'dsworth, Putney)


Blades, Sir George Rowland
Mayday, Arthur
Sanders, Sir Robert A.


Blundell, F. N.
Hayes, John Henry
Sanderson, Sir Frank


Boothby, R. J. G.
Henderson, Rt. Hon. A. (Burnley)
Shaw, R. G. (Yorks, W.R., Sowerby)


Bridgeman, Rt. Hon. William Clive
Henderson, Lieut.-Col. V. L. (Bootie)
Shaw, Lt.-Col. A. D. Mcl. (Renfrew, W.)


Brocklebank, C. E. R.
Heneage, Lieut.-Colonel Arthur P.
Shaw, Rt. Hon. Thomas (Preston)


Brown, Brig.-Gen. H. C. (Berks, Newb'y)
Hennessy, Major J. R. G.
Shaw, Capt. W. W. (Wilts, Westb'y)


Burman, J. B.
Herbert, S. (York, N.R., Scar. & Wh'by)
Shepperson, E. W.


Burton, Colonel H. W.
Hirst, W. (Bradford, South)
Shiels, Dr. Drummond


Campbell, E. T.
Hope, Capt. A. O. J. (Warw'k, Nun.)
Slaney, Major P. Kenyon


Cayzer, Sir C. (Chester, City)
Hudson, Capt. A. U. M. (Hackney, N.)
Smith, Ben (Bermondsey, Rotherhithe)


Chadwick, Sir Robert Burton
Hudson, J. H. (Huddersfield)
Stanley, Lord (Fylde)


Charlatan, H. C.
Inskip, Sir Thomas Walker H.
Stott, Lieut.-Colonel W. H.


Charteris, Brigadier-General J.
Jacob, A. E.
Streatfeild, Captain S. R.


Churchill, Rt. Hon. Winston Spencer
Jenkins, W. (Glamorgan, Heath)
Strickland, Sir Gerald


Clayton. G. C.
Jones, G. W. H. (Stoke Newington)
Stuart, Hon. J. (Moray and Nairn)


Clowes, S.
Jones, Henry Haydn (Merioneth)
Styles, Captain H. Walter


Cochrane, Commander Hon. A. D.
Jones, T. I. Mardy (Pontypridd)
Sugden, Sir Wilfrid


Cockerill, Brig.-General Sir G. K.
Kennedy, A. R. (Preston)
Sutton, J. E.


Compton, Joseph
Kennedy, T.
Thomson, F. C. (Aberdeen, South)


Cooper, A. Duff
Kidd, J. (Linlithgow)
Tinne, J. A.


Cope, Major William
Kindersley, Major Guy M.
Tinker, John Joseph


Couper, J. B.
King, Captain Henry Douglas
Titchfield, Major the Marquess of


Courtauld, Major J. S.
Knox, Sir Alfred
Townend, A. E.


Craig, Ernest (Chester, Crewe)
Lee, F.
Vaughan-Morgan, Col. K. P.


Crookshank, Cpt. H.(Lindsey, Gainsbro)
Lindley, F. W.
Waddington, R.


Cunliffe, Sir Herbert
Lister, Cunliffe-, Rt. Hon. Sir Philip
Wallace, Captain D. E.


Curzon, Captain Viscount
Laugher, L.
Watson, Sir F. (Pudsey and Otley)


Dalkeith, Earl of
Luce, Maj.-Gen. Sir Richard Harman
Wells, S. R.


Dalton, Hugh
MacAndrew, Major Charles Glen
Wiggins, William Martin


Davidson, Major-General Sir J. H.
Macdonald, Capt. P. D. (I. of W.)
Williams, A. M. (Cornwall, Northern)


Davison, J. E. (Smethwick)
McLean, Major A.
Williams, Com. C. (Devon, Torquay)


Dixey, A. C.
Macmillan, Captain H.
Williams, C. P. (Denbigh, Wrexham)


Eden, Captain Anthony
Margesson, Captain D.
Williams, Herbert G. (Reading)


Edmondson, Major A. J.
Monsell, Eyres, Com. Rt. Hon. B. M.
Williams, T. (York, Don Valley)


Edwards, C. (Monmouth, Bedwelity)
Moore-Brabazon, Lieut.-Col. J. T. C.
Wilson, M. J. (York, N. R., Richm'd)


Elliot, Major Waiter E.
Morrison-Bell, Sir Arthur Clive
Wilson, R. R. (Stafford, Lichfield)


England, Colonel A.
Nall, Lieut.-Colonel Sir Joseph
Wise, Sir Fredric


Evans, Capt. Ernest (Welsh Univer.)
Newman, Sir R. H. S. D. L. (Exeter)
Womersley, W. J.


Fanshawe, Commander G. D.
Newton, Sir D. G. C. (Cambridge)
Wood, E. (Chester, Stalyb'ge & Hyde)


Fermoy, Lord
Nicholson, O. (Westminster)
Wragg, Herbert


Frece, Sir Walter de
Nuttall, Ellis



Fremantle, Lieut.-Colonel Francis E.
O'Connor, T. J. (Bedford, Luton)
TELLERS FOR THE AYES.—


Gadie, Lieut.-Col. Anthony
O'Neill, Major Rt. Hon. Hugh
Major Sir Harry Barnston and




Captain Bowyer.




NOES.


Brown, James (Ayr and Bute)
Kelly, W. T.
Watts-Morgan, Lt.-Col. D. (Rhondda)


Day, Colonel Harry
Lawson, John James
Welsh, J. C.


Graham, D. M. (Lanark, Hamilton)
Paling, W.
Wheatley, Rt. Hon. J.


Hail, F. (York, W. R., Normanton)
Riley, Ben



Henderson, T. (Glasgow)
Stephen, Campbell
TELLERS FOR THE NOES.—


John, William (Rhondda, West)
Watson, W. M. (Dunfermilne)
Mr. Buchanan and Mr. Neil




Maclean.

under Section 10 of The Gas Regulation Act, 1920, on the application of the Seaford Gas Company, Limited, which was presented on the 8th June and published, be approved.

Resolved,
That the Draft of a Special Order proposed to be made by the Board of Trade under Section 10 of The Gas Regulation Act, 1920, on the application of the urban district council of Ellesmere, which was presented on the 14th June and published, be approved.

Resolved,
That the Draft of a Special Order proposed to be made by the Board of Trade under Section 10 of the Gas Regulation Act, 1920, on the application of the Portsea Island Gas Light Company, which was presented on the 2nd June and published, be approved, subject to the following modifications:—

Clause 3, sub-clause (1), leave out the definition of "The date of transfer," and insert "The date of transfer means the first day of July, nineteen hundred and twenty-six."

Clause 4, sub-clause (1), line 2, after "be," insert "deemed to have been."

Clause 4, sub-clause (2), line 2, after "shall," insert "be deemed to."

Clause 8, sub-clause (2), line 3, after "be," insert "deemed to have been."

Clause 17, sub-clause (1), line 8, leave out "transfer," and insert "this Order."

Clause 18, sub-clause (1), line 2, leave out "transfer," and insert "this Order."

Clause 19, line 1, leave out "transfer," and insert "this Order."

Clause 20, line 3, leave out "transfer," and insert "this Order."

Clause 20, line 4, leave out "that date be," and insert "the date of transfer be deemed to be."

Clause 23, line 1, leave out "have," and insert "had."

Clause 24, sub-clause (1), line 2, leave out "retire," and insert "be deemed to have retired."

Clause 24, sub-clause (2), line 2, leave out "retire," and insert "be deemed to have retired."

Clause 24, sub-clause (3), line 4, leave out "retire," and insert "be deemed to have retired."

Clause 24, sub-clause (4), line 1, leave out "transfer," and insert "this Order."

Clause 24, sub-clause (4), leave out the proviso.

Clause 26, sub-clause (1), at beginning of line 3, insert "and be deemed to have extended to and included."—[Sir B. Chadwick.]

The remaining Orders were read, and postponed.

It being after Half-past Eleven of the Clock, MR SPEAKER adjourned the House, without Question put, pursuant to the Standing Order.

Adjourned at Twelve o'Clock.